Public Health Law Map - Beta 5 - Medical and Public Health Law Site

standards and who agree to compliance with various laws and regulations as a
condition of maintaining the state-granted privilege. For example, as a condition of
licensure, a medical care practitioner will agree to forgo certain behaviors, that,
whereas not illegal, are considered unprofessional. A hospital agrees to allow the
state hospital inspectors access to hospital facilities whenever they want, without a
warrant or prior notice. An medical care practitioner or facility that accepts payment
for Medicare patients agrees to abide by all the terms of the Conditions of
Participation, even though many have no detailed knowledge of what they have
agreed to abide by. The Conditions of Participation give the federal auditors access
to the participant’s offices, medical records, and any other information related to
compliance with the regulations.
Permits, licenses, and registrations give the agency tremendous power because they
can be suspended if the regulated person or entity does not cooperate with the
agency. If a hospital refuses access to the state inspectors, it can lose its operating
license. Refusal to cooperate with federal auditors can result in termination of the
provider’s right to receive federal payments, and can require that past payments be
refunded. Medical care practitioners who violate the restrictions on their license can
lose their license and livelihood.
b) Administrative Orders and Civil Penalties
License revocations or termination of participation in federal programs is the
administrative death penalty. Agencies use these as a last resort. In most cases, the
agency will enter an administrative order specifying what must be done to eliminate
the violation. This may be to clean up the refrigerator in the hospital kitchen, to
build fire escapes, or to stop billing for work that the health care practitioner is not
personally supervising. Many agencies may also assess fines or other civil penalties,
such as reimbursement for improper payments. These penalties can run to tens of
millions of dollars if they involve systematic improper billing to the federal
government. A hospital would have little choice but to pay the penalty because
termination of its participation in federal programs will put it out of business.
c) Injunctions and Seizures
Injunctions and seizures are widely used in FDA enforcement. These are court
orders that require that an entity or person desist from some action, such as selling
tainted food or manufacturing a drug or device that does not conform to FDA
regulations. Because an FDA injunction can close a business by preventing the sale
of its products, it is a very powerful enforcement tool. There are variations on
injunctions, called embargoes or seizure orders, that allow specific products to be
kept off the market. The product is locked down in the company warehouse, or it
may be physically seized and impounded by the government. When a product is
seized because it presents a threat to the public health or safety, the government
does not have to pay compensation because dangerous property that is not fit for its
intended use is treated as having no value. If the product has a short lifetime, such
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