August 18, 2022

Our On-Call Policy requires physicians to have 30 admissions or operating cases at the hospital per year to participate in the on-call schedule. The Policy also gives discretion to the department chairs, who develop the call schedules, to limit the ability of a particular physician to participate in the schedule for a number of reasons, some of which have nothing to do with the quality of care being provided. Do these provisions in our Policy pose any legal concerns?

Yes. First, conditioning participation in the call schedule on admissions at, or procedures done in, the hospital could be interpreted as conditioning participation on referrals to the hospital. Such a requirement could present compliance issues with the federal Anti-Kickback Statute. In Supplemental Compliance Program Guidance for Hospitals, the Department of Health and Human Services Office of Inspector General (“OIG”) cautioned that “conditioning privileges on a particular number of referrals or requiring the performance of a particular number of procedures, beyond volumes necessary to ensure clinical proficiency, potentially raise substantial risks under the [Anti-Kickback] statute.” Some state courts have found that participation on the call-coverage roster constitutes a “privilege.”

This issue is something that is on the Department of Justice’s radar as well.  For example, in 2010, a hospital agreed to pay the United States $108 million to settle claims that it violated the Anti‑Kickback Statute and the False Claims Act by limiting the opportunity to work at an outpatient cardiology testing unit to cardiologists who referred business to the hospital, giving the cardiologists a percentage of time in the testing unit which corresponded with the gross revenue attributed to the cardiologists’ referrals.  Conditioning participation on the call roster on admissions or performing cases at the hospital presents similar risks.

If compensation is involved in the call coverage arrangements, there is further concern under the Anti‑Kickback Statute. The OIG has warned that under the Anti-Kickback Statute there is “considerable risk” in conditioning compensation for on-call coverage on “doing business at a hospital.”

Finally, giving the department chairs the discretion to limit the ability of a physician to take call poses anticompetitive concerns. While there may be legitimate reasons to limit the ability of a physician to take call, such as issues with a physician’s quality of care, such decisions should not be made solely by potential competitors in the department.