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Last month the U.S. Department of Health and Human Services,
Office of Inspector General (OIG) issued Advisory Opinion No.
12-02, which favorably analyzed an arrangement whereby healthcare
providers offer discount coupons for their medical services and
products to patients by posting them on a website. If an
arrangement is structured with certain safeguards described in the
Advisory Opinion, the OIG concluded that healthcare providers and
suppliers may offer online coupons for their services and products
without risking prosecution.
The party requesting the OIG opinion (the "Requestor")
desired to create a website that offers coupons for a variety of
medical services and products from third-party providers and
suppliers. The Requestor would also sell space on the website for
advertising by the providers and suppliers. The corporation itself
was not a healthcare provider, and while one of the members of the
corporation was a physician, the physician would not be permitted
to post coupons for his services nor would those
providers/suppliers to which the physician made referrals be able
to post coupons. The contracting providers and suppliers would pay
the Requestor a flat monthly fee, consistent with fair market
value, which would be set and paid prior to the actual posting of
the coupons on the Requestor's website. The website would be
open to a variety of providers and suppliers, including physicians,
dentists, physical therapists, optometrists, psychologists,
pharmacies, hospitals and insurance companies. The coupons would
only offer a reduction in price (either in the form of a
predetermined reduced price or a percentage reduction). Free
services or products would be prohibited.
Generally, federal law (including the Anti-Kickback Statute)
prohibits the offering, solicitation, payment or receipt of any
form of remuneration in return for referring an
individual for any item or service reimbursable under Medicare or
Medicaid.
In the situation provided in the Advisory Opinion, the OIG
concluded the risk of improper patient inducement and payment for
referrals was low due to the following key facts:
Coupon Site is Not a Provider. The party
posting the coupons would not be a healthcare provider or supplier,
and was in no other position of being able to refer persons to any
provider/supplier. Thus, the fee paid by the providers and
suppliers was not in exchange for any referrals, mitigating the
risk of abuse under the Anti-Kickback Statute.
Discount, Not Free. Importantly, a reduction
in price, as opposed to free services or products, was viewed
favorably by the OIG and not likely to influence patients to use a
particular provider/supplier.
Flat Fee. The payment made by the
providers/suppliers to the Requestor would be a flat fee,
consistent with fair market value, and would be set and paid in
advance.
No Personal Information. No personal
information would be provided by persons visiting the website
beyond an email address, which would not be shared with the
providers or suppliers.
No Payment for Coupons. The persons using the
website would not have to pay for the coupons, eliminating the risk
that providers would feel pressured to provide the particular
service or product covered by the coupon in the event it was not
appropriate or necessary for the particular patient. Thus,
professional medical judgment would not be compromised.
Discount Safe Harbor. The website would
require the contracting providers and suppliers to comply with the
discount safe harbor of the Anti-Kickback Statute. Even though the
website operator is not a "provider," it would provide
all of the required disclosures to satisfy the discounts safe
harbor as if it were a provider.
Payors Share in Discounts. The discount
obtained with the coupons would be shared by both the payors (both
private and federal) and the patients and would not just apply to
the patient's cost obligation.
Monitoring. The Requestor would monitor the
coupon postings for compliance with these safeguards.
As a result, due to the presence of these safeguards, the OIG
concluded that the Requestor's proposed arrangement would not
result in the imposition of civil monetary penalties or
administrative sanctions. Note that the conclusions in Advisory
Opinion 12-02 are limited to the specific facts surrounding the
Requestor's proposed website. In addition, healthcare providers
may need to navigate state laws, like the restrictions on discounts
and waivers of copays and deductibles, and state physician referral
laws.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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