OIG nixes investment partnership in ambulatory surgery center

Experts say the Office of Inspector General's opinion points out legal risks involved in the arrangements, despite safe harbors.

By Amy Lynn Sorrel, AMNews staff. Dec. 24/31, 2007.

A group practice's proposal to allow referring health professionals to invest in an ambulatory surgery center would run afoul of the federal anti-kickback statute, states a recent advisory opinion by the U.S. Dept. of Health & Human Services' Office of Inspector General.

Legal experts said the Oct. 19 opinion affirms the government's stance that the arrangements can be susceptible to fraud and abuse and are permissible only under specific conditions.

The medical group -- comprised of optometrists and ophthalmologists -- proposed to include the optometrists as investors in three surgery centers the ophthalmologists owned with a hospital. The optometrists refer patients to the ophthalmologists for medical treatment and sometimes assist the surgeons in pre- and postoperative care at the surgery facilities, according to the opinion, which did not disclose the medical group's name.

The OIG concluded that the arrangement fails to meet key safe harbor requirements because the optometrists do not perform the surgeries at the ambulatory center. The federal exceptions mandate that physician investors perform ambulatory surgery center procedures on a regular basis.

The OIG reiterated its "long-standing concern about the potential for investments in [ambulatory surgery centers] to serve as vehicles to reward referrals indirectly."

Although the scenario involves optometrists and ophthalmologists, Pittsburgh-based regulatory expert Beth Anne Jackson, an associate at Thorp Reed & Armstrong LLP, said the proposed relationship is comparable to any primary care or multispecialty group looking to partner in a similar way with surgeons to whom it regularly refers.