"I'm from the government,and I'm here to help..."

By: Mary Ann Porucznik

By Mary Ann Porucznik


“I’m so envious of the tools you use. Walking around the exhibit floor, I wanted to be an orthopaedic surgeon—and I’ll bet you wish I were one, too!” That remark from Lewis Morris, JD, chief counsel for the Department of Health and Human Services (HHS) Office of the Inspector General (OIG), spurred laughter from the 850-member audience of orthopaedic surgeons and industry representatives gathered in the Gateway Ballroom yesterday morning. But for most of the rest of his presentation, there was grim silence.

Mr. Morris was one of five panelists who presented varying perspectives on the evolving situation regarding relationships between orthopaedic surgeons and industry. And the perspective he offered as a government enforcer was not encouraging. Pointing out that he was not a member of either the Department of Justice or the Centers for Medicare and Medicaid Services and thus had no role in either regulations or reimbursement, Mr. Morris focused on the current enforcement environment, potential areas of risk, and compliance resources.

Lewis Morris, JD

“There is a problem”
The scenarios Mr. Morris outlined in OIG’s three areas of enforcement—criminal, civil, and administrative—were not pretty. For example, under the anti-kickback statute (criminal enforcement), any payments from a manufacturer that might be construed as inducement for a physician to recommend an item or service are suspect. Penalties can be severe, including jail and criminal fines, as well as exclusion from all government programs. Under the False Claims Act, he noted, it’s illegal to submit a claim or statement to Medicare or Medicaid knowing that it’s false or fraudulent. In addition, the government doesn’t need to prove specific intent to de fraud. “Recklessness equals liability,” he said. Members of the audience may have felt caught in a vortex as Mr. Morris explained that under the Civil Monetary Penalties aspect of the False Claims Act, cases are not heard by a jury but by an administrative judge who is an employee of the HHS. Hearsay is admissible, and a conviction isn’t needed to exclude the individual from participating in any government programs. Penalties include payments of up to three times the government’s outlay for the investigation, plus a $5,500 to $11,000 per claim penalty. If the case was initiated by a whistle-blower, that individual gets 30 percent of the total penalty payments—a substantial sum in many cases. “Whistle-blowers may themselves have dirty hands,” said Mr. Morris, “but that won’t prevent them from getting a handsome reward.” Under the proposed Physician Payments Sunshine Act (S.2029), manufacturers of pharmaceutical drugs, medical devices, and biologics would be required to disclose the amount of money they give to doctors through payments, gifts, honoraria, travel, and other means. The name of the physician, the nature of the payment or economic benefit, and the basis for the payment would be part of an annual report to HHS and would be published on the Internet. The law would apply to all manufacturers with $100 million or more in annual gross revenues. You can be proactive Mr. Morris encouraged audience members to be proactive if they identify a problem. “Come to us and we can work together to resolve the situation collaboratively and fairly,” he urged. “You will have to return any payments made to you, and you will have to pay a penalty, but the final costs will be much lower than if you don’t self-disclose.” He also outlined the following five steps that physicians could follow to minimize their legal risk:

  • Adhere to professional guidelines, such as the AAOS Standards of Professionalism on Orthopaedist-Industry Conflicts of Interest.
  • Establish a compliance program for your practice.
  • Use the “Fair Market Value” test to judge whether payments are excessive.
  • Use the “Washington Post” test—if you wouldn’t want the arrangement to appear in your local paper, don’t do it.
  • “If it seems too good to be true, it probably is.”

“What you do in caring for patients is remarkable and essential,” said Mr. Morris. “The challenge is managing the conflict of interest that might exist.”

On that point, at least, there was unanimous agreement.