The first advantage of a tax-exempt status is that the organization will eligible for grants for public and private entities. Many government agencies and foundations restrict their grants to public charities (Moseley III, 2013). Second, the formal structure will mean the nonprofit will be recognized as a legal entity. Consequently, the mission of the organization will be placed above personal interests (Moseley III, 2013). The third advantage is limited liability which means that the founders and other stakeholders will not be personally liable for the organization’s debts. To that end, if I am creating an ambulatory surgery clinic, I would seek a tax-exempt status primarily because it will entitle the organization to grants from government agencies and private organizations.
There are various unrelated businesses that a hospital can engage in as long as they contribute to its mission. For instance, a hospital can buy land to lease or build estates from which it can earn rental income. Another example is the operation of a health fitness club targeted at high end consumers. The key factor in the operation of these enterprises is that their profits should not substantially contribute to the hospital’s income.
Aside from the primary salary there are other incentives that can be offered to convince a physician to join an organization. First, a hospital may offer him/her a signing bonus aside from the base salary if the physician is keen on his/her level of renumeration. Second, opportunity for advancement may be a suitable option for professionals who are looking to advance their careers. Another meaningful incentive is insurance cover and retirement plan options. Other incentives that may be useful to physicians include allowing him/her to set up an office, interviewing his/her prospective staff, and helping to develop protocols to be applied in the office.
HIPAA requires entities which are covered to enforce physical, administrative, and physical reinforcements for protected health information (ePHI). These reinforcements are meant to not only safeguard privacy, but also the accessibility and integrity of data (Moseley III, 2013). The security rule is a subset of the privacy rule and specially applies to electronic PHI. On that note, the security rule was created to reinforce the security rule due to the advert of digital medical records. They work together to ensure all kinds of medical information are safeguarded.
The HIPAA Security Rule is an expansion of the Privacy Rule and is meant deal with ePHI. In a wide scope, it requires the deployment of three kinds of safeguards; administrative, technical, and physical. Additionally, it imposes other requirements to an organization and a need to document processes that accompany the HIPAA Privacy Rule. Fundamentally, the privacy rule sets security standards for health information contained and transferred in electronic form (Drolet et al, 2017). As novel innovations continue to affect healthcare providers and the healthcare industry, insurance companies, and other stakeholders involved in the sector of transition to paperless processes and depend on electronic information systems, the security and safety of important health information has become a primary concern.
The Privacy Rule is needed because medical practitioners are entrusted with some of the most delicate and intimate personal information in the lifetime of a patient, including identity and account information. Patients except such information to be kept private. The breach of tis trust leads to serious ramifications to the healthcare entity. On that note, the Privacy Rule restricts the disclosure and use of personally identifiable information related to a patient (Iguchi, Uematsu, & Fujii, 2018). The rule requires covered entities to make practical efforts to request, disclose, and use only the minimum enquired information needed for any given task. The rule also gives patients the rights to access their personal medical records and rights over their health information.
A hospital, physician, or pharmacy could be in trouble if it receives money to offer discounts to a patient. Taking money or receiving gifts from a drug company is not justified by the argument that the entity would have prescribed the drug even without the kickback (Moseley III, 2013). The government does need to prove patient home to demonstrate that the entity broke the AKS. A hospital, physician, or pharmacy could be liable for breaking AKS even if the service was actually rendered and the service was necessary from a medical perspective.
There are several possible outcomes when healthcare organization implements a transaction or arrangement that does not satisfy any Safe Harbors. These include overutilization, corruption in regards to medical decision making, increased costs of medical programs, unfair competition, and patient steering (Moseley III, 2013). On that note, such arrangements are deemed illegal and the healthcare organization will be subject to a law suit.
The purpose of a Special Fraud Alert is to identify the practices in the medical sector that are especially susceptible to abuse and fraudulent schemes that can be used to acquire money from Federal healthcare programs (Moseley III, 2013). The Office of the Inspector General (OIG) receives copies of the alerts and investigates them to determine if further punitive action should be taken against the organization suspected of nagging in fraud
Drolet, B. C., Marwaha, J. S., Hyatt, B., Blazar, P. E., & Lifchez, S. D. (2017). Electronic communication of protected health information: privacy, security, and HIPAA compliance. The Journal of hand surgery, 42(6), 411-416.
Iguchi, M., Uematsu, T., & Fujii, T. (2018, September). The Anatomy of the HIPAA Privacy Rule: A Risk-Based Approach as a Remedy for Privacy-Preserving Data Sharing. In International Workshop on Security (pp. 174-189). Springer, Cham.
Moseley III, G. B. (2013). Managing Legal Compliance in the Health Care Industry. Jones & Bartlett Publishers.