Retail medical clinics: issues for consideration

Drug Store News, Nov 6, 2006 by Jeff Sinaiko

The increases in high-deductible health insurance plans and health savings accounts catalyzed by federal tax incentives, and an ever growing un- or underinsured public, have contributed to increased out-of-pocket health care expenditures. These changes are leading to a new paradigm where consumerism and health care intersect, where the "patient" is increasingly the "shopper" or "consumer" who is much more sensitive to price, value and convenience. As a result, a burgeoning concept has emerged that promises a fast and convenient way to receive basic medical services: the retail health clinic.

The aggressive growth of retail clinics, coupled with an increasing percentage of insurers who cover at least some of the retail clinic services, will ultimately-lead to issues, regulatory risks and complexities at are similar, if not identical, to issues faced by current health care systems and providers. For instance, when billing Medicaid, Medicare or private payers, compliance with the payers state and/or federal statutes and requirements is required. Thus, to mitigate the risk of audit and investigation by state, federal or private payers, sufficient attention should be given to billing compliance, including:

Appropriate coding and billing of services provided; appropriate supervision of services provided by mid-level providers, such as nurse practitioners and physician assistants; prompt and appropriate issuance of refunds for excess payments to customers, when necessary; accurate and timely co-payment collection and adherence to quality-of-care standards.

In addition, a solid commitment to a compliance and ethics program can improve the performance of retail clinics and their parent companies while increasing their adherence to federal, state and private payer requirements and guidelines. A compliance program can serve to assess employee and contractor behavior relating to fraud and abuse; reduce risk of violating the False Claims Act; lead to early detection and reporting of compliance risks; improve internal communication and increase the quality, efficiency and consistency of services.

Key elements of a compliance program include: written policies, procedures and standards of conduct; designated compliance officer and compliance committee; effective training and education; effective lines of communication; enforcement of standards through disciplinary guidelines; internal monitoring and auditing; prompt response to detected offenses and subsequent corrective action; and direct involvement of the board of directors in compliance oversight.

According to the United States Sentencing Commission Guidelines, in addition to a compliance plan, the governing authority of the clinics must: "be knowledgeable about [its] content and operation;" "exercise reasonable oversight with respect to [its] implementation and effectiveness;" provide direct access to the governing authority for the high-level individuals responsible for operating the program; and receive effective training and information relating to compliance, appropriate to each person's role and responsibilities.

The majority of retail medical clinics are staffed by nurse practitioners and physician assistants. Licensing requirements, scope of practice and their degree of autonomy are set by various regulations and/or the medical board of each state. Adherence to these laws, which vary from state to state and are constantly changing, is key to ensuring compliance with regulations, reduction of malpractice risk and valid private or public insurance claims.

A variety of patient referral arrangements between local providers, health systems, medical groups and retail medical clinics currently exist within various markets, which must be evaluated to ensure that they do not violate anti-kickback statutes.

Many retail medical clinics lease space within retail stores that also have pharmacies to which the clinics will be sending their patients. Where such a relationship exists, the lease agreements between retailers and the clinics and/or any other financial arrangement between the two parties must be at fair market value, in order to ensure compliance with applicable state and federal law. Although retail medical clinics are a relatively novel concept, the majority of issues and risks they face have been experienced or studied within traditional clinics and the well-established health care marketplace. Thus, experience and expertise gleaned from work within existing health care frameworks should be further examined, transferred and built upon to assist retail medical clinics to avoid risk and address their most pertinent issues. The momentum driving the growth of retail medical clinics should be coupled with informed guidance to provide the most efficient and effective care within a regulatory compliant clinical setting.

Jeff Sinaiko is president of Sinaiko Healthcare Consulting