Senate Bill No. 156–Senator Titus

 

February 18, 2003

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Joint Sponsor: Assemblywoman Buckley

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Referred to Committee on Human Resources and Facilities

 

SUMMARY—Provides additional exception to prohibition against practitioner referring patients to certain facilities in which practitioner has financial interest. (BDR 40‑710)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to health care; providing an additional exception to the prohibition against a practitioner referring patients to certain facilities in which the practitioner has a financial interest; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. NRS 439B.425 is hereby amended to read as

1-2  follows:

1-3  439B.425  1.  Except as otherwise provided in this section, a

1-4  practitioner shall not refer a patient, for a service or for goods

1-5  related to health care, to a health facility, medical laboratory,

1-6  diagnostic imaging or radiation oncology center or commercial

1-7  establishment in which the practitioner has a financial interest.

1-8  2.  Subsection 1 does not apply if:

1-9  (a) The service or goods required by the patient are not

1-10  otherwise available within a 30-mile radius of the office of the

1-11  practitioner;

2-1  (b) The service or goods are provided pursuant to a referral to a

2-2  practitioner who is participating in the health care plan of a health

2-3  maintenance organization that has been issued a certificate of

2-4  authority pursuant to chapter 695C of NRS;

2-5  (c) The practitioner is a member of a group practice and the

2-6  referral is made to that group practice;

2-7  (d) The referral is made to a surgical center for ambulatory

2-8  patients, as defined in NRS 449.019, that is licensed pursuant to

2-9  chapter 449 of NRS;

2-10      (e) The referral is made by:

2-11          (1) A urologist for lithotripsy services; or

2-12          (2) A nephrologist for services and supplies for a renal

2-13  dialysis;

2-14      (f) The financial interest represents an investment in a

2-15  corporation that has shareholder equity of more than $100,000,000,

2-16  regardless of whether the securities of the corporation are publicly

2-17  traded; [or]

2-18      (g) The referral is made by a physician to a surgical hospital in

2-19  which the physician has an ownership interest and:

2-20          (1) The surgical hospital is:

2-21             (I) Located in a county whose population is less than

2-22  100,000; and

2-23             (II) Licensed pursuant to chapter 449 of NRS as a surgical

2-24  hospital and not as a medical hospital, obstetrical hospital,

2-25  combined-categories hospital, general hospital or center for the

2-26  treatment of trauma;

2-27          (2) The physician making the referral:

2-28             (I) Is authorized to perform medical services and has staff

2-29  privileges at the surgical hospital; and

2-30             (II) Has disclosed his ownership interest in the surgical

2-31  hospital to the patient before making the referral;

2-32          (3) The ownership interest of the physician making the

2-33  referral pertains to the surgical hospital in its entirety and is not

2-34  limited to a department, subdivision or other portion of the hospital;

2-35          (4) Every physician who has an ownership interest in the

2-36  surgical hospital has agreed to treat patients receiving benefits

2-37  pursuant to Medicaid and Medicare;

2-38          (5) The terms of investment of each physician who has an

2-39  ownership interest in the surgical hospital are not related to the

2-40  volume or value of any referrals made by that physician;

2-41          (6) The payments received by each investor in the surgical

2-42  hospital as a return on his investment are directly proportional to the

2-43  relative amount of capital invested or shares owned by the investor

2-44  in the hospital;

3-1       (7) None of the investors in the surgical hospital has received

3-2  any financial assistance from the hospital or any other investor in

3-3  the hospital for the purpose of investing in the hospital; and

3-4       (8) Either:

3-5           (I) The governing body of every other hospital that

3-6  regularly provides surgical services to residents of the county in

3-7  which the surgical hospital is located has issued its written general

3-8  consent to the referral by such physicians of patients to that surgical

3-9  hospital; or

3-10             (II) The board of county commissioners of the county in

3-11  which the surgical hospital is located has issued a written

3-12  declaration of its reasonable belief that the referral by such

3-13  physicians of patients to that surgical hospital will not, during the

3-14  5-year period immediately following the commencement of such

3-15  referrals, have a substantial adverse financial effect on any other

3-16  hospital that regularly provides surgical services to residents of that

3-17  county[.] ; or

3-18      (h) The referral is made by a physician to a surgical hospital

3-19  or a medical-surgical hospital in which the physician has an

3-20  ownership interest and:

3-21          (1) The hospital:

3-22             (I) Is centrally located in a county whose population is

3-23  400,000 or more to serve the residents of that county conveniently;

3-24             (II) Is licensed pursuant to chapter 449 of NRS as a

3-25  surgical hospital or a medical-surgical hospital;

3-26              (III) Primarily provides services relating to the spine,

3-27  the musculoskeletal system and the control and alleviation of pain,

3-28  and rehabilitative services;

3-29             (IV) Has a capacity of not more than 50 beds;

3-30             (V) Has and maintains a policy providing for the care of

3-31  indigent patients; and

3-32             (VI) Provides education concerning techniques to

3-33  alleviate pain;

3-34          (2) The physician making the referral:

3-35             (I) Is authorized to perform medical services and has

3-36  staff privileges at the hospital; and

3-37             (II) Has disclosed his ownership interest in the hospital

3-38  to the patient before making the referral;

3-39          (3) The ownership interest of the physician making the

3-40  referral pertains to the hospital in its entirety and is not limited to

3-41  a department, subdivision or other portion of the hospital;

3-42          (4) Every physician who has an ownership interest in the

3-43  hospital has agreed to treat patients receiving benefits pursuant to

3-44  Medicaid and Medicare, and to provide services to indigent

3-45  patients;

4-1       (5) The terms of investment of each physician who has an

4-2  ownership interest in the hospital are not related to the volume or

4-3  value of referrals made by that physician;

4-4       (6) The payments received by each investor in the hospital

4-5  as a return on his investment are directly proportional to the

4-6  relative amount of capital invested or shares owned by the investor

4-7  in the hospital;

4-8       (7) None of the investors in the hospital has received any

4-9  financial assistance from the hospital or any other investor in the

4-10  hospital for the purpose of investing in the hospital; and

4-11          (8) The hospital provides surgical and rehabilitative

4-12  services, and such related and ancillary services as are necessary

4-13  and incident to the provision of those services.

4-14      3.  A person who violates the provisions of this section is guilty

4-15  of a misdemeanor.

4-16      4.  The provisions of this section do not prohibit a practitioner

4-17  from owning and using equipment in his office solely to provide to

4-18  his patients services or goods related to health care.

4-19      5.  As used in this section:

4-20      (a) “Group practice” means two or more practitioners who

4-21  organized as a business entity in accordance with the laws of this

4-22  state to provide services related to health care, if:

4-23          (1) Each member of the group practice provides substantially

4-24  all of the services related to health care that he routinely provides,

4-25  including, without limitation, medical care, consultations, diagnoses

4-26  and treatment, through the joint use of shared offices, facilities,

4-27  equipment and personnel located at any site of the group practice;

4-28          (2) Substantially all of the services related to health care that

4-29  are provided by the members of the group practice are provided

4-30  through the group practice; and

4-31          (3) No member of the group practice receives compensation

4-32  based directly on the volume of any services or goods related to

4-33  health care which are referred to the group practice by that member.

4-34      (b) “Patient” means a person who consults with or is examined

4-35  or interviewed by a practitioner or health facility for purposes of

4-36  diagnosis or treatment.

4-37      (c) “Substantial adverse financial effect” includes, without

4-38  limitation, a projected decline in the revenue of a hospital as a result

4-39  of the loss of its surgical business, which is sufficient to cause a

4-40  deficit in any cash balances, fund balances or retained earnings of

4-41  the hospital.

 

4-42  H