Safe harbor rules for ambulatory surgery centers protect investment

Contract Language. By Steven M. Harris, AMNews contributor. May 7, 2001.

CONTRACT LANGUAGE

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As investment in ambulatory surgery centers increases, so too does the danger that the investing physicians may end up violating federal anti-kickback statutes.

The government is concerned that an investment by a physician in an ambulatory surgery center provides the potential for indirect kickbacks, because the physician might receive a return on his or her referrals through the ASC's profit distribution.

Addressing this concern, the Office of Inspector General of the Dept. of Health and Human Services has established safe harbor rules that, if met fully, will protect a doctor who invests in an ASC from prosecution under the federal anti-kickback statutes. Investments that do not meet a safe harbor are not necessarily illegal, but will need to be examined on a case-by-case basis.

Agreements among physicians investing in an ASC should include representations that address the applicable safe harbor provisions.

The ASC safe harbor is divided into four categories: surgeon-owned ASCs, single-specialty ASCs, multispecialty ASCs and hospital-physician ASCs. I'll focus my discussion on the first three categories, the ones without hospital involvement.

The surgeon-owned ASC category protects investments in which all the physician investors are either general surgeons or surgeons engaged in the same surgical specialty. Specifically, to meet the safe harbor requirements of the surgeon-owned ASC category, all of the investors in the ASC must be:

• General surgeons or surgeons of the same surgical specialty who are in a position to refer patients directly to the ASC and perform surgery on such patients.