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Co-Management Agreements, Compensation & Compliance
June 1, 2011
Published by ABA Health eSource
Hospitals’ critical success factors are shifting towards quality performance benchmarked to national standards. This trend towards improved quality is increasing the need for hospitals to align with physicians since they control the delivery, management, and utilization of clinical services. As a result, many hospitals are involving physicians in various types of service arrangements, such as co-management agreements.
It is important to understand that compensating physicians for assisting in the attainment of high quality care must be set at Fair Market Value (“FMV”) and that the terms of the arrangement must be consistent with regulatory guidelines. Failure to do so could result in criminal and/or civil penalties based on healthcare fraud and abuse laws. The following provides an overview and regulatory guidance associated with paying for quality care and specifically addresses co-management agreements.