Then think again.
Many in the PT industry are taking the news of Stryker Medical Corp’s former Physiotherapy Associates (now part of a private equity firm) $16.6 million settlement with the Department of Justice as some type of celebration against “corporate PT”. Think again, again.
$16.6 million for Stryker is a couple of circo-electric beds, 5 artificial vertebral disks, and a few implants in a bad week for a company whose revenues are approx 6 Billion and market cap of over 29 Billion. To a large extent, the settlement probably represents a systematic flaw in a few billing centers.
Let’s recap. 2 employees (quite possibly PT’s but more likely billing folks) filed a whistelblower regarding alleged retainment of excess of duplicate payments received by federal health care programs including medicare, medicaid, and Tricare (don’t forget that Tricare is really medicare from a compliance standpoint). These employees will get $3 million each as part of the settlement (a reward of sorts for having the courage to file a complaint).
Physiotherapy Associates in June sold their 475 clinics in 31 states to Water Street Healthcare Partners for $150 million cash plus had to retain this pending settlement with DOJ. You can to a certain extent consider the $16 M reduction as less in purchase price and their exit from the PT world is now complete (a corporate integrity agreement is probably left in the hands of the aquirers as part of the deal).
I have no idea but my guess is that Physio probably had an outstanding compliance program. It is a mistake to believe that big PT companies whether they are private, public, or non-profit are lax when it comes to all aspects of compliance. Just the opposite is typically true. They understand that bigger means more exposure and they spend disproportionately on auditing and training all aspects of the patient care and billing rules (not to mention accounting, OSHA, and the myriad of HR issues).
The real lesson here is that regardless of your PT clinic’s size, have a strong compliance program. I can personally attest that many of the PT’s that I have hired from very small private practices or “reputable” employers had no clue that the 8 minute rule exists or that techs cannot treat medicare patients. In many conversations with new PT’s, I have received feedback that they learn various “rules” while in PT school and then get clinical internships or first jobs where they are ignored in total. The other lesson is that your compliance program needs to take into account billing issues including refunds to patients and payors. There are many who mistakenly think that over payments by Medicare can be “credited” toward future patients or “a bonus for not getting paid on others”.
Lastly, if you think you are bullet proof from potential whistleblower suits, think again. 2 folks are $3 million dollars richer from this settlement.
Thoughts?
