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socrateaser
socrateaser, Attorney
Category: Business Law
Satisfied Customers: 38507
Experience:  Retired (mostly)
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Hello My husband owns a medical billing company. He wants

Resolved Question:

Hello
My husband owns a medical billing company. He wants to start a DME (Durable Medical Equipment) business on the side. Most of his current business is referred to him from his brother who is an occupational medicine doctor (Workmans comp). His brother gives his patients back and neck braces as well as other supportive equipment, but these are provided by an "outside" company. If he sets up a DME company to supply his brothers clinics with the equipment, would this be in any way illegal? If so, what about if the new business is set up in MY name?
Submitted: 5 years ago.
Category: Business Law
Expert:  socrateaser replied 5 years ago.
Title 42 U.S.C. 1395nn prohibits business referrals in which Medicare funds are used, between a physician and an "immediate family member."

Under 42 CFR 411.351, "Immediate family member" or "member of a physician's immediate family" means husband or wife; birth or adoptive parent, child, or sibling; stepparent, stepchild, stepbrother, or stepsister; father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law; grandparent or grandchild; and spouse of a grandparent or grandchild.

Based upon your stated facts, a durable medical equipment business arrangement between your brother your husband or you would violate federal law.

Hope this helps.


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Customer: replied 5 years ago.
Thank you. What if the funder was not Medicare, but rather private insurance sources?
Expert:  socrateaser replied 5 years ago.
If the physician or DME supplier receive Medicare payments from any source, then each will fall within the scope of the statute. So, you and the physician would have to totally sanitize your respective customer bases. Theoretically possible, but probably not very easy to accomplish.

Hope this helps.


And, if you need to contact me again, please put my user id on the title line of your question (“ToCustomerrdquo;), and the system will send me an alert. Thanks!

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