Policy statement: Resident Referrals
To comply with applicable laws regarding referrals, neither [PROVIDER] nor a vendor shall solicit or receive from any person or entity, nor offer or give to any person or entity, anything of value if that person or entity is in a position to refer business and/or residents to [PROVIDER], or if [PROVIDER] is in a position to refer business to that person or entity, except as permitted by law. This policy does not preclude the purchase, rental, lease, or other acquisition or provision of reasonable and necessary services or items for fair market value by [PROVIDER] or its employees.
Providers may wish to include the following suggested elements in their corporate compliance policy.
All vendor agreements shall meet the requirements listed below when any item(s) or service(s) supplied by the vendor are reimbursable under any state or federal health care program. The list is not exhaustive, but is the minimum required for any such vendor agreement. Vendor agreements;
- Shall be in writing;
- Shall specify the particular services or supplies to be provided;
- Shall specify the fee or payment to be made to the vendor, which shall be set at the fair market value for such service or supplies and/or be based upon applicable fee schedules or other payment guidelines established by CMS or its designees, the state Medicaid agency or its designees, or other applicable third-party payors, and shall not take into consideration the value or volume of referrals provided to or by [PROVIDER]
- Shall specify that vendor will submit all bills in accordance with the payment method and amount set forth in the vendor agreement;
- Shall have a term of at least one year or shall provide that the agreement shall not be renegotiated within 12 months of its inception in the event of its termination before the expiration of 12 months;
- Shall be signed by all parties; and
- Shall certify that the vendor currently is eligible for participation in the Medicare and, where applicable, Medicaid programs.
Vendor agreements involving service or supplies with a value in excess of [CHOOSE LIMIT] per year shall meet the following additional requirements:
- The agreement shall be negotiated only by [legal counsel and/or the facility administrator or their designees or other people selected by the provider];
- The agreement shall be approve by [legal counsel or his or her designee or other people selected by the provider];
- If the value or cost of the services to be provided under the vendor agreement equals or exceeds $10,000 over a 12-month period, the vendor will, for a period of at least four years after the furnishing of the services and supplies, retain records to verify the nature and extent of the cost of such services and supplies and make such records available upon request by [PROVIDER]; and the vendor shall impose similar obligations on any subcontractor it uses to provide the services and supplies under the vendor agreement; and
- The vendor and any subcontractor of the vendor shall cooperate with [PROVIDER] in the event that any third-party payor, including the Medicare and Medicaid program, conducts and audit or otherwise requests documentation regarding services or supplies provided by the vendor or its subcontractor.
All payments to vendor shall be specified in the vendor agreement.
BUILDING AND EQUIPMENT LEASES
All building and/or equipment leases shall meet the requirements below and shall be reviewed and approved by legal counsel or his or her designee prior to execution to avoid violation of anti-kickback or Stark laws. Similar state laws may also apply and should be reviewed so that all such leases comport with state law as well.
Providers may wish to include the following suggested elements in their corporate compliance policy. In general, leases:
- Shall be in writing;
- Shall have a term of at least one year;
- Shall specify the premises or equipment covered by the lease;
- Shall set the rental charge in advance;
- Shall specify the exact schedule of access or use, the precise length, and the exact rent if the lease is for part-time or periodic access;
- Shall charge a rental or lease charge consistent with fair market value, and which does not take into consideration the value of business referrals between the parties; and
- Shall be commercially reasonable and not exceed what is necessary for the legitimate business purpose of the lease.