12/03/2025    Paul Kesselman, DPM

Insurance Compliance Audits for Employed Podiatrists (Daniel Chaskin, DPM)

Dr. Chaskin brings up an excellent question of who
is responsible for clawbacks when any healthcare
provider works as an employee. There is no one
fits all answer to this question and one must
explore a number of common possibilities. Their
legality (in particular for the last one) is
beyond my paygrade.

#1: Many physicians who work for facilities,
hospital groups etc. are W2 employees and hence do
not directly bill for their services. The claim
form may have them as the rendering physician with
their NPI and name but the billing information
(to whom the funds will go) will be that of the
facility, hospital, etc.

An example here familiar to Dr. Chaskin in NY is
NYU Langone or Northwell Hospital, which owns many
physician groups. Rest assured, the individual
physician (or possibly even the group) is NOT the
billing entity but they may be the rendering
entity. In the case of many physician groups which
are owned by these hospitals, the group may be the
"billed by entity" and not the hospital itself and
the employed physician still may be listed as the
rendering entity. What the financial arrangement
is between the group and the hospital is another
story and how those funds are allocated is beyond
the scope of this question.

#2 In another familiar scenario, a physician works
as an associate for a group of physician's or one
other physician. The physician of record may
appear to be the rendering physician as is in the
previous case. Or more likely they may also be
listed as the billing physician. However their
enrollment status with this Provider Transaction
Number (PTAN) the rendering provider may have the
benefits reassigned to the employer. Thus while
invisible to the patient or not readily apparent
on the claim, the associate has transferred their
rights to the finances and it goes to the "group"
or the employer physician.

#3 There are other situations where the doctor who
is being paid by the carrier (Medicare or
otherwise), then pays a portion (e.g. percentage)
to the entity which owns the practice (e.g.
facility). The legality of these arrangements is
something again above my paygrade and for a health
care attorney to provide comment on.

In both 2 and 3 the associate is more of an
independent contractor and not a W2 employee (as
it is in #1) according to IRS regulations.

What I am suggesting is that in the case where you
are an employed physician as a W2 employee or
where the physician has reassigned benefits, the
third party payer will likely be addressing the
entity which received the payments and not the
employed physician (W2 or Independent Contractor).
In other words, Follow the Money!

It is the last scenario which is problematic. As
any third party will be coming looking for the
entity which received the money. In these
situations the flag that Dr. Chaskin is waving is
one, I hope readers are paying attention to.They
won't care if you paid a significant chunk to
another party. You got the money so please pay us
back.

The message here is clear: In all cases, anyone
signing a contract as an "employed" physician of
an entity, whether as a true W2 or Independent
contractor, or especially in scenario #3 all
require legal counsel review to ensure the rights
of the "employee" are protected..

Paul Kesselman, DPM, Oceanside, NY

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