Advisory Opinion: Clinic Can Provide Free Telemedicine Equipment, Services

TelemedicineA nonprofit, federally qualified health center look-alike (FQHC) can use grant funds to provide telehealth equipment and services for free to facilitate encounters with patients of a county-run clinic that provides testing, treatment and counseling for HIV, based on a recent advisory opinion issued by the Department of Health and Human Services Office of the Inspector General.

A FQHC is a community-based healthcare provider that meets the requirements of the HRSA Health Center Program, but does not receive Health Center Program funding. They provide primary care services in underserved areas on a sliding fee scale based on ability to pay, and operate under a governing board that includes patients.

Under the proposed arrangement, the FQHC advised that it wanted to use funding received from the State Department of Health, AIDS Institute to provide the county clinic with free laptops and cameras, as well as technical assistance such as installation, maintenance, updates and training. It noted that the main purpose of the grant funding is to increase access to HIV prevention services, namely consultations relating to the prescription and use of pre-exposure prophylaxis (PrEP) and post-exposure prophylaxis (PEP). The proposed arrangement, according to the FQHC, would improve patient access to HIV prevention services, making it more likely patients would seek out and receive care.

The OIG noted that although the arrangement could potentially implicate the anti-kickback statute by resulting in referrals to the provider for the virtual consultations and follow-up services, it would present a low risk of fraud and abuse and therefore would not impose administrative sanctions for the following reasons:

First, the proposed arrangement would include certain safeguards designed to prevent inappropriate patient steering. Specifically, the county clinic would be free to refer its patients to other providers and suppliers. The clinic would advise all patients they can receive consultations either via telemedicine or in person from the provider or another qualified provider. And, there is nothing inherent to the telemedicine items that would (i) limit or restrict the use or compatibility of the telemedicine items with different information technology systems, software applications, or networks; or (ii) inhibit the ability of any users of the telemedicine items to communicate or exchange data accurately, effectively, securely, and consistently with different information technology systems, software applications, and networks.

Second, the proposed arrangement would unlikely result in inappropriate patient steering to the provider’s pharmacy and the patients would be free to fill their prescriptions at a pharmacy of their own choosing. Given that the provider’s pharmacy is located 80 miles from the clinic and does not offer mail-order services, the requestor noted that it would be unlikely the patient would use its pharmacy.

There was one caveat. The OIG noted its conclusion might change if the provider’s pharmacy either starts to offer mail-order services or if the provider opens a pharmacy closer to the clinic at a later date.

Third, the proposed arrangement unlikely would inappropriately increase costs to federal healthcare programs because, regardless of the proposed arrangement, the tests, consultations and follow-up services would have been performed and could be billed to a federal healthcare program. The proposed arrangement simply would increase the chances that those patients who require HIV-related services would actually receive them. The requestor noted that access to HIV-related services is consistent with the purpose of the grant funds. Also, PrEP and PEP treatments are prescribed under limited circumstances, thus lessening the risk of overutilization. And finally, increased access to preventive HIV services could reduce the prevalence of HIV and promote public health.

Fourth, while the county clinic and provider might benefit from the arrangement, the primary beneficiaries would be the patients who could receive HIV-related services more conveniently and efficiently.

As with any Advisory Opinion, the findings are specific only to the requestor. However, such opinions do provide insight into how the OIG might rule in cases where the facts are similar. If you have any questions about any proposed arrangements you are considering, contact us at 305-358-4500 or send us an email to

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