In the midst of the Coronavirus (COVID-19) pandemic, healthcare providers and suppliers will need to make decisions on how to ensure compliance with existing federal fraud and abuse laws while taking swift action to avoid disruptions in the normal delivery of care. While the US federal government has begun to issue limited guidance, there remain a number of outstanding questions. In this On The Subject, we explore scenarios and options that can help providers maintain good “compliance hygiene.”
In this unprecedented public health emergency, many healthcare providers and suppliers are facing new questions on how to address compliance with existing federal fraud and abuse laws, such as the anti-kickback statue (AKS; see 42 U.S.C. § 1320a-7b(b)) and beneficiary inducement provisions of the Civil Monetary Penalty Law (Beneficiary Inducement Statute, or BIS; see 42 U.S.C. § 1320a-7a(a)(5)), in the middle of a pandemic that requires swift action to avoid extreme disruption in the normal delivery of care.
For example, how do providers handle patients in financial need with little time to conduct a financial need assessment? How do providers find ways to deliver care to patients while protecting their workforce and those same patients during a time of social distancing that could last weeks?
The government has begun to address some of these issues. On March 17, 2020, the Department of Health and Human Services Office of Inspector General (OIG) issued a policy statement permitting routine waiver of copays for telehealth services (Policy Statement). Otherwise, there is not much precedent or guidance on applying these laws to the many ways this unusual situation is impacting the industry and beneficiaries.
However, there is some existing flexibility within these laws to address many of these questions and situations. While many of these issues are more specifically covered in BIS exceptions than under AKS safe harbors, OIG’s AKS analysis is consistently similar to its BIS analysis. Many situations may not clearly fit within a BIS exception or an AKS safe harbor, but that is not the end of the analysis. Now is the time to review the facts and circumstances and think about how common sense and reasonable mitigation steps can be applied to maintain compliance and also meet patient needs during a crisis. We address the basic framework for this analysis and the most applicable exceptions here.
Is There a Beneficiary Inducement in the First Place?
The BIS prohibits any person from paying or offering any remuneration to a Medicare or Medicaid beneficiary that the offeror knows or should know is likely to influence the beneficiary’s selection of a particular provider or supplier of Medicare- or Medicaid-payable items or services.
If the patient is a long-established patient of the provider, and the remuneration is geared towards enabling the patient to continue to see that provider during a time when social distancing is recommended or mandated (such as home visits to avoid patients coming into crowded waiting areas), then there is a question about whether the BIS is truly implicated. In other words, is the remuneration being offered in a manner that the provider knows or should know is likely to influence the beneficiary’s selection of a particular provider or supplier to continue to receiving care from that provider? Or, alternatively, is the remuneration being offered to promote social distancing or another societal benefit intended to combat the spread of Coronavirus (COVID-19)?
Similarly, the AKS prohibits remuneration to induce a person, including a patient, to refer others or themselves to someone for the furnishing of items of services paid by federal healthcare programs. Again, if the patient is a long-established patient and the remuneration involved is intended to promote control of COVID-19, there is more likely to be an argument that there is no inducement triggering the AKS.
Also, keep in mind that OIG has also interpreted the BIS prohibitions to exclude offers of inexpensive items or services with a retail value of no more than $15 per item or $75 in the aggregate per patient on an annual basis. (See 81 FR 88368; prior to December 7, 2016, the limits were $10 per item or $50 in the aggregate per patient on an annual basis.) Therefore, remuneration below these thresholds generally requires no further analysis.
As to new patients, the analysis under the BIS and AKS may become somewhat more complex, as the risks that the remuneration will be viewed as an incentive to the patient to seek care from the provider become greater. In such scenarios, providers should evaluate the arrangements from both the perspective of the provider and the perspective of the patient. For example, if the provider intends for the remuneration to motivate a new patient to seek care from the provider over another provider based on the remuneration offered, rather than based on the underlying COVID-19-related goals, the arrangement is likely to implicate both the BIS and AKS. Alternatively, if the provider is offering the remuneration with the intention to incentivize behavior that is intended to mitigate COVID-19 for all patients, both new and established, rather than to attract new patients, the risks may be lower.
For example, if the provider is implementing a new care-delivery protocol practice-wide to promote social distancing, such as offering home visits to all patients who may have greater risk of contracting the virus, then there may be an argument that there is no intent to induce the patient to seek care from that provider over another because the practice has changed the way it operates in light of the unusual circumstances posed by the pandemic.
Has the Copay or Deductible Waiver Already Been Granted by OIG?
First, we note that many diagnostic tests do not carry Medicare copays. Further, recent legislation has removed copays for COVID-19 tests. In addition, OIG’s Policy Statement notified physicians and other practitioners that they will not be subject to administrative sanctions for reducing or waiving any cost-sharing obligations federal healthcare program beneficiaries may owe for telehealth services for arrangements that satisfy both of the following conditions:
A physician or other practitioner reduces or waives cost-sharing obligations (i.e., coinsurance and deductibles) that a beneficiary may owe for telehealth services furnished consistent with the then-applicable coverage and payment rules.
The telehealth services are furnished during the time period subject to the COVID-19 national emergency declaration.
For any free telehealth services furnished during the time period subject to the declaration, OIG will not view the provision of free telehealth services alone to be an inducement or as likely to influence future referrals (i.e., OIG will not view the furnishing of subsequent services occurring as a result of the free telehealth services, without more, as evidence of an inducement).
OIG’s statement leaves open the more pressing question about how to enable patients who do not own the technology to conduct a telemedicine visit to receive telemedicine services when telemedicine may be the safest type of services to provide in light of COVID-19. While OIG did not go so far as to say that providing the technology to engage in telemedicine services could never be an inducement, the Policy Statement also does not say it is always an inducement. As a result, providers contemplating providing technology to patients must look for another exception or rely on a reasonable facts and circumstances analysis and risk assessment.
For other items and services, the BIS and implementing regulations contain an exception to the term “remuneration” for non-routine, unadvertised waivers of copayments or deductible amounts based on individualized determinations of financial need or exhaustion of reasonable collection efforts. Many providers have a policy on how to evaluate a patient’s financial need. In care situations that may arise due to COIVD-19, however, there may not be sufficient time to assess the patient’s financial situation under the policy. For example, a hospital may not have the time or staff to evaluate patient financial documentation in the timeframe set forth under the policy. In times of emergency, providers may need to make reasonable decisions about adjusting financial need policy requirements, such as obtaining documentation after care is provided.
Does the Remuneration Fit Within an Existing Safe Harbor?
Promoting Access to Care with Low Risk of Harm
The BIS was amended by the Affordable Care Act (ACA) to add an exception to permit “certain remuneration that poses a low risk of harm and promotes access to care” (see 81 Fed. Reg. 88396 (December 7, 2016)). OIG interprets “promoting access to care” as “improving a particular beneficiary’s, or a defined beneficiary population’s, ability to obtain items and services payable by Medicare or a State health care program.” OIG explained that its interpretation encompasses providing the tools necessary for removing “socioeconomic, educational, geographic, mobility, or other barriers that could prevent patients from seeking care (including preventive care) or following through with a treatment plan.”
OIG defines “care” in “access to care” as “access to items and services that are payable by Medicare or a state health care program for the beneficiaries who receive them.” This means that the exception may not cover remuneration that encourages beneficiaries to access services that could promote general wellness, unless those services are covered by the individual’s Medicare or state healthcare program benefit.
OIG stated that remuneration would pose a low risk of harm to Medicare and Medicaid beneficiaries and the Medicare and Medicaid programs by (i) being unlikely to interfere with, or skew, clinical decision making, (ii) being unlikely to increase costs to federal healthcare programs or beneficiaries through overutilization or inappropriate utilization and (iii) not raising patient safety or quality-of-care concerns.
For example, the temporary loan of a limited-functionality smartphone to enable an existing immunocompromised patient to receive telemedicine services during the national emergency declaration should fall within this exception.
The ACA also added a “financial hardship-based” exception to protect the offer or transfer of items or services for free or less than fair market value if (i) the item or service is not advertised or solicited, (ii) the item or service is not tied to the provision of other services reimbursed by Medicare or Medicaid, (iii) there is a reasonable connection between the item or service and the individual’s medical care, and (iv) there is an individualized determination of financial need.
OIG explained that items or services may not be “conditioned on” the patient’s use of other Medicare- or Medicaid-reimbursable services but that the item or service must be reasonably connected to an individual’s medical care from both a medical and financial perspective. Again, while this exception requires a financial-need assessment, timing exigencies unique to this pandemic may dictate conducting that assessment at a later time to avoid delays in providing needed assistance to patients to prevent bad outcomes.
In the end, providers are faced with the challenge of making reasoned judgments about how to manage the effective delivery of care in a time of crisis and with limited guidance from the government. Keep in mind that under the existing laws not all offers of remuneration to patients are prohibited. Many arrangements that providers may need to put in place to assist in controlling the spread of COVID-19 may not implicate the BIS or AKS and others may fit within a new waiver or existing safe harbor or exception.
For those arrangements that do not meet any of these exceptions, the existing “facts and circumstances” test will apply. Providers should ensure that they are taking appropriate steps to evaluate arrangements that may involve offers of remuneration to patients, but should not view the BIS and AKS as an absolute barrier to arrangements intended to benefit societal aims in “flattening the curve.”
It is important in this time to remember to maintain good “compliance hygiene” when making these decisions by creating contemporaneous documentation to explain the reasons for and intent behind the arrangement. Eventually, this crisis will end. When it does, the government or relators will inevitably raise issues for inquiry. Actions taken today to memorialize the reasons and thought that went into making these decisions will prepare you for that inquiry.