Health Care Law and Ethics in a Nutshell by Mark A. Hall & David Orentlicher

Author:Mark A. Hall & David Orentlicher
Language: eng
Format: epub
ISBN: 9781684676422
Publisher: West Academic
Published: 2020-10-15T00:00:00+00:00

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Chapter 5

Complex Transactions and Organizational Forms

As a consequence of increasing regulation and rapidly changing economic and legal forces, hospitals, doctors, and insurance companies have formed all manner of new organizational approaches to health care delivery and insurance, resulting in an explosion of acronyms. In the 1970s, we saw the birth of Health Maintenance Organizations (HMOs), a form of prepaid group medical practice explored in Chapter 1.A.2.f. This was followed in the 1980s by the creation of Preferred Provider Organizations (PPOs), a form of bulk purchase of medical services explored in Chapter 4.C.1. These are only the principal examples of integrated delivery systems (“IDSs”). Physicians and hospitals have formed joint venture organizations (sometimes called PHOs for physician-hospital organizations) for various purposes, and are now exploring new arrangements known as accountable care organizations (ACOs). Doctors have organized into large multi-specialty group practices known as independent practice associations (IPAs). And insurers of all types are using innovative methods (some of which are thankfully still unabbreviated) for controlling medical expenditures.

The result of this cauldron of activity has been to make the health care lawyer’s work much more demanding—and in demand. Each of these innovative arrangements must be evaluated under a broad spectrum of private and public law. This 224

chapter examines the bodies of law that are most relevant to these complex transactions and new organizational forms. In considers questions such as: When is an insurer or clinic engaged in the unlicensed corporate practice of medicine? Should physicians who receive capitation payments be regulated as de facto insurance companies? Should HMOs or joint ventures between doctors and hospitals be exempt from tax? What must nonprofit hospitals and insurers do in order to convert to for-profit status? Can hospitals reward physicians for generating income?

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