OIG Answers COVID-19 Questions Related to OIG’s Administrative Enforcement Authorities

May 16, 2020

The Department of Health and Human Services’ Office of Inspector General (“OIG”) published FAQs–Application of OIG’s Administrative Enforcement Authorities to Arrangements Directly Connected to the Coronavirus Disease 2019 (COVID-19) Public Health Emergency (the “FAQs”), last updated on May 14, 2020, that it will continue to update as it responds to additional questions.  To protect patients, OIG is ensuring that health care providers have needed regulatory flexibility to adequately respond to the COVID-19 pandemic.  OIG is accepting inquiries from the health care community regarding the application of OIG’s administrative enforcement authorities, including the Anti-Kickback Statute (the “AKS”) and Civil Monetary Penalty (“CMP”) provision prohibiting inducements to beneficiaries.  However, the informal feedback included in the FAQs does not bind or obligate any Federal agency.  The following highlight a few questions that have been addressed by OIG to date.

Can a clinical laboratory that bills Federal health care programs for laboratory tests to diagnose COVID-19 pay a retail pharmacy a fair market value fee for certain costs that the retail pharmacy incurs related to COVID-19 testing collection sites?

In the context of the COVID-19 public health emergency, the arrangement described in the above question would present sufficiently low risk under the following circumstances: (a) costs are incurred by the retail pharmacy to operate the testing collection sites; (b) payment is fair market value for the items and services furnished by the retail pharmacy in operating the sites; and (c) the retail pharmacy is not submitting claims to Federal health care programs or receiving other Federal or State funding that reimburses it for the items and services furnished by the retail pharmacy in running the sites for which the laboratory reimburses the pharmacy.  On the other hand, if the pharmacy billed Federal health care programs for or received Federal or State funding to cover the costs associated with the items and activities for which the clinical laboratory would reimburse the pharmacy, such remuneration may violate the AKS. Further, the parties must determine what the fair market value payment would be for such services.

Why does the previously released OIG Policy Statement not incorporate all of the blanket waivers to the Stark Law?

The OIG Policy Statement does not incorporate sections II(B)(12)-(17) of the Stark Law blanket waivers. Those waivers protect “referrals” and not “remuneration.”  To analyze referrals by physicians to entities for designated health services under sections II(B)(12)-(17) of the blanket waivers, OIG recommends considering whether such referrals would result in remuneration that implicates the AKS.  Also, section II(B)(18) of the blanket waivers protects a compensation arrangement that is not set forth in writing or signed by the parties but otherwise complies with a Stark Law exception.  When analyzing an arrangement neither set forth in writing nor signed by the parties but that otherwise fully complies with an applicable Stark Law exception, OIG suggests considering whether any remuneration stemming from the arrangement implicates the AKS.  If concern remains after such an analysis, OIG welcomes parties to submit questions to OIGComplianceSuggestions@oig.hhs.gov

Can an oncology group provide free in-kind local transportation to and from an established patient’s house to an alternate practice location for the purpose of receiving medically necessary oncology care?

Because the COVID-19 pandemic presents unique circumstances, OIG believes that free modest, in-kind transportation assistance provided to established patients of an oncology practice would present a low risk of fraud and abuse so long as the transportation assistance is: (a) provided by an “eligible entity” to an “established patient,” for free or at a reduced cost to obtain medically necessary items or services furnished; (b) provided only when necessary; and (c) not air, luxury, or ambulance-level transportation.  Furthermore, for the transportation assistance to present a low risk of fraud and abuse, the eligible entity must not: (i) determine eligibility for transportation assistance in a manner related to the past or anticipated volume or value of Federal health care program business; (ii) publicly market or advertise the in-kind transportation or market health care items and services during the course of the transportation or at any time by drivers; or (iii) pay drivers or others arranging for the transportation on a per-beneficiary-transported basis. 

Can health care providers furnish services for free or at reduced rates to assist skilled nursing facilities or long-term-care providers that are facing staffing shortages due to the COVID-19 pandemic?

Due to the COVID-19 pandemic, the scenario presented by the above question may present a low risk of fraud and abuse under the AKS and CMP, provided the services are: (a) necessary as a result of staffing shortages connected to the COVID-19 outbreak to meet patient care needs; (b) provided for free or at a reduced cost only when necessary; (c) limited to the period subject to the COVID-19 public health emergency declaration; and (d) not contingent on referrals for any items or services that may be reimbursable in whole or in part by a Federal health care program.

Can a hospital provide for free access to its HIPAA-compliant, web-based telehealth platform to independent contractors on the medical staff to furnish medically necessary telehealth services? OIG stated that free access to a hospital’s telehealth platform by physicians on its medical staff would present a low risk of fraud and abuse under the AKS and could improve beneficiaries’ access to telehealth services, provided the platform is: (a) given for free to physicians to furnish medically necessary telehealth services; (b) furnished only when necessary and during the period subject to the COVID-19 public health emergency declaration; (c) not conditioned on the physician’s past or anticipated volume or value of referrals to, or other business generated for, the hospital for any items or services that may be reimbursable in whole or in part by a Federal health care program; and (d) offered on an equal basis to all physicians on the medical staff.