It’s Official: The End of the Per-click Lease

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On October 1, 2009, CMS will finalize several amendments to the Stark regulations enacted in the 2008 Medicare Physician Fee Schedule. And while not many in radiology are expected to tear their coats or attend the wake, this day will mark the end of the per-click leasing arrangement, one of the most notorious Stark loopholes currently on the books.

Adrienne Dresevic, Esq, and partner Abby Pendleton, Esq, The Health Law Partners, Southfield, Mo, posted the obituary during a session called Recent Developments and Key Legal Issues Impacting Radiology Practices.

Actually, three loopholes are scheduled to expire on October 1, 2009, requiring that all of the following such arrangements be unwound by that date:

1. Elimination of per-click leasing arrangements. “For years, CMS has allowed parties to refer to each other based on a per-click arrangement,” Dresevic says. “This applies to direct and indirect leases. Blocks are still OK, but CMS advisories indicate they should be a minimum of 4 hours.”
2. Elimination of percentage-based lease arrangement, if percentage is a result of use of equipment or space.
3. Elimination of services provided under arrangements. Dresevic notes that this describes many relationships between hospitals and referring physicians where they provided imaging services and contracted with hospitals under arrangements and hospital would bill for services.

Dresevic provided the following under-arrangements example: If a group of cardiologists and a hospital have formed a JV, and the JV entity furnishes 64-slice CT, the cardiologists would have to divest themselves. But if the partner was a radiology group, radiologists would not be prohibited from referring to hospitals for CTA services.

Another hot regulatory issue impacting radiology providers is the debate over when an imaging provider must become an IDTF, rather than an in-office provider, Dresevic reports. A memorandum stating that a provider must become an IDTF if 30% or more of the work performed is from outside physicians, has been withdrawn, she says.

Getting clear guidance on this issue is a problem though, Dresevic notes. “Most carriers will not give you a number,” she says. “They may have a local carrier review decision that addresses this issue but many do not.”

According to Dresevic, a radiology group that provides the TC of imaging is not required to be an IDTF if owned by radiologists, a hospital, or both; or, if the group ordinarily bills on a global basis. One of the proposals introduced in the proposed 2009 MPFS as an attempt to address concerns regarding quality of services would have required that any physician who performed diagnostic testing services—even if they had an xray machine in their office—would be required to enroll as an IDTF. However, that proposal was shelved. Providers of mobile doagnostic services, no matter what they provide or who owns them, are required to enroll as IDTFs.

Dresevic says that CMS is trying to give more guidance on this subject and referred to a December 2008 FAQ on its website, that essentially says this: if you are just providing equipment and nonphysician personnel, you do not have to enroll as an IDTF. She adds that CMS continues to monitor this issue, and if you are in this arrangement and haven’t become an IDTF, you may want to take steps to do so.