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Physician compensation governance

Rosalind Cordini (rcordini@cokergroup.com) is Senior Vice President/Director of Compliance Services and Randy Gott (rgott@cokergroup.com) is Senior Vice President at Coker Group in Alpharetta, GA.

Over the past several years, hospitals and health systems have been parties to numerous significant settlements associated with alleged improper compensation arrangements with physicians, including Tuomey ($72 million),[1] Adventist Health System ($118.7 million), North Broward Hospital District ($69.5 million),[2] and recently, Kalispell Regional Healthcare System ($24 million).[3]

And as though that was not enough of a financial blow, the Department of Justice has, and continues to implement, the Yates Memo,[4] which holds individual executives accountable for their role in permitting noncompliant physician arrangements. This includes, among others, Ralph J. Cox III, the chief executive officer of Tuomey Health System, who entered into a personal settlement of $1 million.[5] Although the Centers for Medicare & Medicaid Services (CMS) has indicated it intends to make the Stark Law[6] less burdensome for providers,[7] if and until that time comes, healthcare organizations must continue to be vigilant and precise in their compliance programs, particularly regarding physician compensation arrangements.

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