In a recent development that will be of interest to corporate legal teams, particularly those in the health sector, the Office of Inspector General (OIG) has issued a favorable opinion regarding a proposal for a physician group employer to pay bonuses to its employed physicians based on net profits. This is according to the recent Advisory Opinion 23-07, published on October 13, 2023.
As the advisory opinion proposes, the bonuses would be derived from the net profits correlated with certain procedures carried out by the physicians at ambulatory surgical centers. Robinson+Cole Health Law Diagnosis provides a comprehensive analysis of the advisory opinion on its website.
Although the OIG publishes various advisory opinions on many topics, this specific advisory opinion could potentially create new opportunities for remuneration within the health sector. If accepted and implemented, the proposal could significantly alter payment structures and bring about new considerations in compliance and contractual obligations for both individual physicians and corporate legal departments.
Yet, it is crucial to bear in mind that such an approval does not necessarily denote a sea change in the regulator’s stance. Each submission is evaluated based on its unique attributes, and the OIG’s opinion may not extend to similar proposals by other providers.
Legal professionals should continuously keep track of these changes and consult with an experienced attorney to understand how such a shift might impact future agreements and alerts about compliance issues. This advisory opinion mandates serious consideration from legal professionals in the health sector and sets a precedent for the future of employment contracts in this area.