Call Arrangements in the Healthcare Industry: Discussion with Ashley Graver from Coker Group

Episode Date: August 16, 2023

In this episode of Stark Integrity, Bob Wade (“Captain Integrity”) is joined by Ashley Graver, Vice President at Coker Group, to explore a topic that sits at the intersection of operations, physician compensation, and regulatory compliance: call arrangements in the healthcare industry.

Call coverage is essential to hospital operations, particularly for emergency departments and specialty services. However, as Ashley Graver explains, these arrangements are also high-risk from a Stark Law and Anti-Kickback perspective, requiring thoughtful structuring, ongoing monitoring, and careful valuation.

This episode highlights that call arrangements are not simply operational necessities—they are highly scrutinized financial relationships that must be actively managed.

What Are Call Arrangements and Why They Matter

At a foundational level, call arrangements require physicians to be available outside normal working hours to provide care when needed—particularly in emergency or inpatient settings.

These arrangements exist because:

• Hospitals must ensure continuous patient access to care, especially in emergency departments
• Regulations such as EMTALA require adequate physician coverage
• Certain specialties (e.g., trauma, cardiology, gastroenterology) must be available on short notice

Call coverage is therefore both a clinical necessity and a regulatory requirement, making it indispensable to hospital operations.

However, what was once an expected professional duty has evolved into a formal compensation arrangement, adding complexity and compliance risk.

Why Call Arrangements Have Become a Compliance Focus

Ashley Graver emphasizes that call coverage has become a major focus for regulators due to the increasing use of compensation to secure coverage.

Historically:

• Physicians often provided call coverage without separate compensation
• Coverage was viewed as part of medical staff responsibilities

Today:

• Physician shortages and burnout have reduced willingness to take unpaid call
• Hospitals are offering stipends or other compensation to secure coverage
• Payments for call coverage have increased significantly

This shift has drawn regulatory attention because payments may be viewed as disguised remuneration for referrals if not structured properly.

The Stark Law and Call Coverage

A central issue discussed in the episode is how call arrangements fit within the Stark Law framework.

Under Stark:

• Compensation between physicians and hospitals creates a financial relationship
• Referrals for designated health services trigger compliance requirements
• The arrangement must fit within an applicable exception

For call coverage arrangements, this means:

• Compensation must be set in advance
• Payments must be consistent with fair market value (FMV)
• Compensation cannot take into account the volume or value of referrals
• The arrangement must be commercially reasonable

Failure to meet these criteria can result in serious enforcement consequences, even without intent.

Determining Fair Market Value for Call Coverage

One of the most complex aspects of call arrangements is determining fair market value.

Ashley Graver highlights that FMV in this context is not straightforward, because it depends on multiple factors, including:

• The physician’s specialty
• Whether the call is restricted (on-site) or unrestricted (off-site)
• Frequency and duration of call coverage
• Number of actual callbacks or patient encounters
• Burden of coverage, including nights, weekends, and holidays
• Patient acuity and payor mix

Because of these variables, FMV analysis must be fact-specific and data-driven, rather than formulaic.

Importantly, regulators expect compensation to reflect the actual burden and service provided—not the physician’s referral potential.

Equitable Payment and Internal Consistency

A key concept emphasized by Ashley Graver is the importance of equity and consistency in compensation.

She explains that:

• Payment for call coverage should be applied consistently across similarly situated physicians
• Disparities in compensation can raise red flags
• Organizations must be able to justify why certain physicians are paid differently

This is particularly important in multi-physician or multi-specialty environments, where inconsistent practices can lead to perceived favoritism or hidden inducements.

“Don’t Set It and Forget It”

One of the most practical and memorable takeaways from the episode is Ashley Graver’s warning against treating call arrangements as static.

She explains that organizations often:

• Establish a call coverage arrangement
• Obtain an initial FMV opinion
• Then fail to revisit or monitor the arrangement

This “set it and forget it” approach creates significant risk because:

• Market conditions change
• Physician workload may increase or decrease
• Actual call utilization may differ from assumptions

Ongoing monitoring is essential to ensure the arrangement remains:

• Accurate
• Defensible
• Compliant over time

The Role of Market Data

Another important theme discussed is the use of market data in structuring call arrangements.

Ashley Graver notes that:

• Benchmark data can help establish a baseline for compensation
• Surveys and industry reports provide useful context
• However, data must be interpreted carefully and adjusted for specific circumstances

Overreliance on market data without context can result in:

• Overcompensation
• Misalignment with actual services
• Weak defensibility in the event of review

Operational and Strategic Considerations

Beyond compliance, the episode highlights the operational challenges associated with call coverage.

Hospitals must balance:

• Ensuring adequate physician coverage
• Managing rising compensation costs
• Mitigating physician burnout
• Maintaining compliance with regulatory requirements

This creates a tension between clinical necessity and financial risk, requiring organizations to take a strategic and interdisciplinary approach.

Practical Takeaways

The key takeaway from Ashley Graver’s insights is that call arrangements require active management, not passive oversight.

Healthcare organizations should:

• Carefully assess the need for each call coverage arrangement
• Ensure compensation is fair market value and commercially reasonable
• Apply payment methodologies consistently and equitably
• Avoid reliance on static assumptions or outdated data
• Continuously monitor and reassess arrangements over time
• Document the rationale for compensation decisions thoroughly

Final Thoughts

This episode makes clear that call arrangements are far more complex than they appear on the surface.

While they are essential for ensuring patient access and hospital operations, they also represent high-risk financial relationships under the Stark Law and Anti-Kickback Statute.

Through Ashley Graver’s practical and valuation-focused perspective, the message is clear:
Call coverage must be treated as a dynamic compliance issue, requiring ongoing attention, discipline, and alignment with market realities.

Organizations that approach call arrangements proactively—rather than reactively—will be far better positioned to manage both operational demands and regulatory risk.

Click here to listen to this Stark Integrity Podcast Episode:
https://podcasts.apple.com/us/podcast/call-arrangements-in-the-healthcare-industry/id1588939373?i=1000624594213&l=fr-FR