Posted by: Robert Markette
April 20, 2006

There continues to be a great deal of discussion about the Office of Inspector General’s Advisory opinion from March 27. The biggest issue seems to be what can we continue to do without violating fraud and abuse. It has been suggested by some that the key concern to OIG was the nature of the visit. This has led to a recurring suggestion that agencies could instead perform a coordination visit, which is a prerequisite to home care.

In my opinion, if you are providing free services to a patient or prospective patient, you are on a very dangerous road. Right or wrong, OIG will most likely not see any difference between free pre-operative assessments and other free services to home care clients. OIG’s concern in the March 27 opinion was not the type of service being provided.

Its concern was that the service was being provided for free and that this was done to maximize the agencies opportunity to meet with the potential patient before surgery (and before they had the opportunity to choose a post operative health care provider). The free service, in turn, was likely to lead the beneficiary to choose the requesting agency as her provider of post operative home care. (Providing free non-covered services to a current patient would implicate the same concerns.)

The facts of the case implied that the doctor referred the patient for an assessment, in order to determine if the patient’s home was an appropriate place for recovery. If it was not, the physician would not be able to order home care. In effect, this visit was a necessary service to determine the appropriateness of home care, but that did not alert OIG’s analysis. (I discussed in an earlier post that OIG may have overlooked a few good reasons to not prosecute this type of arrangement.)

Over the years, OIG has offered a number of advisory opinions regarding free items or services to referral sources and beneficiaries. In the overwhelming majority of cases, OIG has advised the arrangement would violate the Anti-Kickback or Civil Money Penalty Statutes.

There have been exceptions, for example OIG has occasionally found an arrangement to be a violation, but not one it would prosecute. For example, last year OIG offered an opinion on home health agencies offering medic alert pagers for free that found them not to be a violation, because of CMS’s mandate to HHAs to adopt innovative telehealth technologies.

Of course, there is the CMP exception for low value items or benefits, but in light of the “beneficiary’s perception” analysis used by OIG in the March 27 letter, if you are offering a service, it may be impossible to fit within that exception. OIG determined that a service that cost the agency only $10.00 to provide was likely to be perceived by the beneficiary as a valuable service.

In my mind, the bottom line is that if you provide a free service to a beneficiary (or to a referral source for that matter) you are likely engaged in a violation of the anti-kickback and civil money penalty statutes. You should be very hesitant to engage in any form of free visit to a home care client, regardless of what you call it.

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