Advisory Opinion

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HHS-OIG published a new favorable advisory opinion on October 21, 2015 regarding free transportation services offered by an integrated health care system.  Integrated health care systems continually seek ways to provide seamless, connected care to patients who may be using multiple providers for treatment of medical conditions. Free transportation is a potential way to ensure that patients attend their numerous appointments, but offering such a benefit without appropriate safeguards implicates the Anti-Kickback Statute (“AKS”) (42 U.S.C. § 1320a-7b(b)) or the Beneficiary Inducement Civil Monetary Penalty (“CMP”) Law (42 U.S.C. § 1320a-7a(a)(5)).

Advisory Opinion 15-13, largely reinforces the existing guidance that HHS-OIG has published on the subject of free transportation.  We note that HHS-OIG released Advisory Opinion 15-13 even though it published a proposed rule in October 2014 that would specifically establish a new safe harbor for free or discounted local transportation services.  Regardless, until a final rule describing a transportation safe harbor is available, Advisory Opinion 15-13 clarifies that arrangements where a health care system provides free transportation services to patients who see physicians with offices located on that health care system’s campus or at affiliated locations are acceptable under the applicable fraud and abuse laws, even if such physicians are not bona fide employees of the health care system.  These arrangements will be permissible so long as the benefits of such free transportation services are “incidental” and do not serve to induce referrals to the non-employed physicians or influence beneficiaries to choose these non-employed physicians.Continue Reading Health Care System Receives Favorable Advisory Opinion for Free Transportation Services

In issuing Advisory Opinion 14-03 (the “New Opinion”) in early April, OIG also took the highly unusual step of rescinding another advisory opinion issued in 2011, Opinion 11-18 (the “2011 Opinion”). Both opinions involve electronic health record (EHR) interfaces that facilitate physician referrals to outside providers and suppliers for ancillary services. As OIG continues to signal its increasing interest in policing EHR-related fraud, this action only serves to reinforce the idea that not only should providers using such systems should be vigilant in ensuring that their systems are compliant with established meaningful use requirements, they should also ensure that vendor relationships that involve EHR coordination comply with federal anti-kickback and Stark law rules as well.

The 2011 Opinion originally examined and found acceptable an arrangement whereby a provider of electronic practice management services (the “First Requestor”) offered a package of EHR software to clients for a discounted monthly subscription fee. The First Requestor charged a small per-transaction fee for the service of facilitating electronic referrals between health professionals and other physicians and ancillary service providers who were not “trading partners,” meaning that they had not enrolled in First Requestor’s service. The total amount of fees that the First Requestor could collect from a provider was capped at the amount of the discount on the overall package. Services provided included the transfer of relevant records, tracking communications between the providers, tracking orders by referring providers, and issuing patient referral reminders. The First Requestor provided trading partners with access to a database of information about providers offering certain services (i.e., labs, pharmacies, DME suppliers, and imaging services) that included both trading partners and non-trading partners.Continue Reading OIG Terminates Prior Opinion on EHR Exchange Fee Structure

In Advisory Opinion 13-09, the HHS-Office of Inspector General (OIG) determined that a company’s offer of equity to members of its subsidiary group purchasing organization (GPO), partially in exchange for certain commitments to purchase through the GPO, could constitute a violation of the federal anti-kickback statute, 42 U.S.C. § 1320a–7b(b) (the “AKS”). While Advisory Opinion 13-09 is significant for GPOs, it also resonates more broadly, as to the AKS’s discount safe harbor, as well as any instance where the acquisition of equity is connected to items or services reimbursable under a federal health care program.

Background

The opinion’s Requestor was a company providing financial and performance improvement technology-based products and services. The GPO at issue was wholly-owned by the Requestor, and contributed approximately 60 percent of the Requestor’s revenue. On behalf of its members, the largest of which were hospital systems and integrated delivery systems, the GPO negotiated discounts and other contractual terms with vendors. Continue Reading OIG Issues Unfavorable Opinion on Proposed Offer of Equity Interest to GPO Members