OIG Opinion Applies Access to Care Exception

Can a hospital system provide free or reduced-cost lodging and meals to certain financially needy patients, or would such an arrangement (a) constitute either a violation of the federal anti-kickback statute or (b) constitute grounds for the imposition of civil monetary penalties because it would violate a provision of the Social Security Act that prohibits remuneration to a federal healthcare program beneficiary that might influence the beneficiary’s selection of a particular provider?

That was the question recently answered in an Advisory Opinion issued by the U.S. Department of Health and Human Services Office of the Inspector General (OIG).

The requestor, whose name is redacted, owns and operates an academic medical center consisting of four hospitals and a number of hospital-based clinics. One of those hospitals operates a Level I trauma center and provides care to patients, some of whom live in rural and medically underserved areas.

Under the proposed arrangement, the hospital would help certain patients receive free or reduced-cost lodging and hospital cafeteria meals. Specifically, they would receive one night before and up to two nights after treatment at a nearby hotel and meals not to exceed $15 per overnight stay.

The hospital outlined several qualifications the patient would need to meet. Among them, the patient would need to live 90 miles or more from the hospital, in a medically underserved area with a health professional shortage and have a household income that does not exceed 500 percent of the federal poverty level. The patients would not receive payment directly, but the hospital would pay the hotel and cafeteria. Social workers on staff would determine a patient’s eligibility in accordance with the hospital’s written policy.

The hospital estimated that 100 to 200 of its patients would qualify under the proposed arrangement each year. It also noted that while a patient’s family member could stay with the patient in the hotel room, the family member would not qualify for the lodging alone.

Based on the facts of this particular case, the OIG concluded that the proposed arrangement would not constitute grounds for the imposition of sanctions because it would satisfy the requirements of the Promotes Access to Care Exception. The OIG also found that although the proposed arrangement could potentially generate prohibited remuneration under the anti-kickback statute, if the requisite intent to induce or reward referrals existed, the OIG would not impose administrative sanctions in connection with the proposed arrangement.

“While we would be concerned if Requestor proposed to offer luxury accommodations or expensive restaurant meals, the proposed arrangement would not involve these types of incentives,” the OIG wrote in its opinion.

The OIG noted that providing lodging the night before enabled patients to attend early morning treatments or evaluations without having to travel a significant distance on the day of the scheduled procedure. And, providing post-treatment lodging would make follow-up care more accessible.

The OIG went on to state that the arrangement was unlikely to interfere with clinical decision making because the requestor would not condition eligibility for the proposed arrangement on the receipt of any particular service provided by the hospital and because neither the requestor nor the hospital would provide remuneration to any clinician to encourage him or her to refer patients to the hospital.

In coming to its conclusion, the OIG also considered that fact that the hospital certified that it would not shift any of the costs of the patient benefits to any federal healthcare program nor report any of the costs on hospital’s cost reports or claims. And, because the hospital would not advertise or market the proposed arrangement and offer it only to existing patients, it was not likely the proposed arrangement would lead to overutilization or inappropriate utilization.

It’s important to note that OIG advisory opinions apply only to the requestor of the opinion. If you have concerns about possible arrangements, it’s important that you contact your healthcare law attorney for advice specific to your situation.

The Health Law Offices of Anthony C. Vitale can assist clients in navigating the very complex rules and regulations impacted by this advisory opinion. Give us a call at 305-358-4500 or send us an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.