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A year after issuing its General Compliance Program Guidance, the Department of Health and Human Services Office of Inspector General (“OIG”) has published the first industry-specific compliance guidance with  “Industry Segment-Specific Compliance Guidance for Skilled Nursing Facilities and Nursing Facilities” (the “Nursing Facility ICPG”). 

Notably, it has been more than 16 years since…

The Office of Inspector General of the Department of Health and Human Services (OIG) has published an unfavorable advisory opinion involving a proposal by a Medicare Advantage Organization (MAO) offering Employer Group Waiver Plans (EGWPs) to share a percentage of its savings with certain groups to which it provides coverage.

With this advisory opinion (AO 24-08) OIG highlighted how it analyzes certain risk-sharing arrangements for managed care organizations and found that this particular arrangement did not present a sufficiently low enough fraud and abuse risk under the federal Anti-Kickback Statute (AKS).Continue Reading OIG Issues Unfavorable Opinion on Medicare Advantage Gainsharing Arrangements

The Department of Health and Human Services Office of Inspector General (OIG) recently issued two advisory opinions related to proposed arrangements offering financial assistance to individuals who receive gene therapy treatments. These arrangements were specifically targeted to patients who may suffer from infertility as a result of the treatments’ required chemotherapy-based fully myeloablative conditioning (Conditioning).

While proposed arrangements for travel support (as discussed below and in a June 14, 2024 advisory opinion) appear to receive approval from OIG, other proposed financialsupports for infertility services have received unfavorable opinions primarily because of a lack of data available to OIG regarding whether the proposed assistance would improve the ability of patients to access the gene treatment therapies.

These unfavorable decisions effectively chill arrangements to provide additional financial support to individuals who are enrolled in federal and state health care programs and require gene therapy treatments, though OIG has indicated that it may issue favorable decisions in the future if it receives additional data.  Continue Reading OIG Issues Opinions On Arrangements Involving Gene Therapy Treatments

On April 8, 2024, the Department of Health and Human Services Office of Inspector General (OIG) issued Advisory Opinion No. 24-02, involving independent charity patient assistance programs (PAPs) associated with 12 specific diseases (the Disease Funds) operated by the Requestor. Each Disease Fund has a single donor–a pharmaceutical manufacturer that manufactures or markets a drug to treat the disease state associated with the fund.

Although the arrangement generates remuneration prohibited under the federal Anti-Kickback Statute (AKS) if the requisite intent were present, the OIG determined it would not impose sanctions on the Requestor. In exercising its enforcement discretion, the OIG acknowledged the public policy benefits of independent charity PAPs while highlighting the importance of a charity’s independence from pharmaceutical manufacturer influence. Additionally, the arrangement does not implicate the federal Beneficiary Inducements Civil Monetary Penalties (CMP) law.

The OIG set an effective period for the opinion that expires January 1, 2027 due to upcoming reductions in Medicare Part D cost sharing associated with the Inflation Reduction Act. The reduction in beneficiary out-of-pocket expenses could ease demand for PAP subsidies and alter the OIG’s assessment of the benefits and risks of the arrangement.Continue Reading OIG Exercises Discretion in Independent Charity Patient Assistance Program

On September 28, 2023, the Office of Inspector General of the Department of Health and Human Services (OIG) issued Advisory Opinion 23-06, involving a proposed services arrangement between a pathology laboratory (the Requestor) and third-party referring pathology laboratories. 

The OIG determined that, if the requisite intent were present, the proposed purchase of the technical component of anatomic pathology services from certain laboratories would generate prohibited remuneration under the federal Anti-Kickback Statute (AKS). In doing so, the OIG highlighted the proposal’s lack of commercial reasonableness and reaffirmed its longstanding suspicion over arrangements that “carve out” federal health care program business.Continue Reading OIG Issues Unfavorable Advisory Opinion Concerning Pathology Lab’s Proposed Purchased Services Arrangements

On February 28, 2023, the Department of Health and Human Services’ Office of Inspector General (“OIG”) issued a favorable advisory opinion regarding an arrangement through which a pharmaceutical company provides free enzyme replacement therapy (“ERT”) medication to patients who satisfy certain eligibility requirements where the patients’ insurer is delayed in making a coverage determination.

The OIG noted that, although the arrangement would generate prohibited remuneration under the federal Anti-Kickback Statute (“AKS”) if conducted with the requisite intent, it would not impose administrative sanctions. Further, the OIG opined that the arrangement would not generate prohibited remuneration under the beneficiary inducement prohibition (“Beneficiary Inducement CMP”).Continue Reading OIG allows drug company to provide free medication during coverage determination delay

The U.S. Court of Appeals for the Eighth Circuit recently weighed in on the causation standard for False Claims Act (“FCA”) cases premised on Anti-Kickback Statute (“AKS”) violations. United States ex rel. Cairns v. D.S. Med. LLC, 42 F.4th 828 (8th Cir. 2022). The panel adopted a strict interpretation, finding that the government or whistleblowers must show a “but-for” causal relationship between kickbacks and claims for payment to establish the requisite link in the FCA liability chain, creating a circuit split on an issue that courts have struggled with for years.

The decision is notable for FCA defendants as it offers support for a defense they have long asserted, and that courts have been reluctant to condone, including an opinion from the U.S. Court of Appeals for the Third Circuit that refused to require a direct causal link between an AKS violation and a false claim.Continue Reading Eighth Circuit Finds “But-For” Causation Standard for AKS-Premised FCA Cases

With another presidential transition in the history books, you may find it unsurprising to hear that many of us at Reed Smith are continuing to closely monitor and track which of the outgoing Trump administration’s “midnight regulations” will survive past the early months of the Biden administration. But for those less familiar with the topic…

The Department of Health and Human Services (HHS) released complementary rules this past Friday, November 20, 2020, to modernize and clarify the regulations that interpret the Physician Self-Referral Law (the Stark Law) and the federal Anti-Kickback Statute.

As we wrote when the proposed rules were released last autumn (see client alerts here and here),…

The much-anticipated final rules modernizing the safe harbors under the Anti-Kickback Statute (AKS) and the physician self-referral exceptions under the Stark Law are officially under review by the Office of Management and Budget (OMB). The Department of Health and Human Services (HHS) anticipates publishing the final rules in August 2020, although that target date is…