AMARILLO, TX – The federal Civil Monetary Penalties (“CMPs”) prohibition forbids offering any remuneration to federal health care program (“FHCP”) patients if a provider knows or should know that it is likely to influence the patient’s selection of the provider. Notwithstanding this prohibition, the Affordable Care Act makes some exceptions for activities that would otherwise constitute remuneration under the CMPs. This includes an exception for remuneration that (i) poses a low risk of harm and (ii) promotes access to care.

According to the OIG, remuneration poses a low risk of harm if it (i) is unlikely to interfere with, or skew, clinical decision making, (ii) is unlikely to increase costs to federal health care programs or beneficiaries through overutilization or inappropriate utilization, and (iii) does not raise patient safety or quality of care concerns.

In a 2017 Advisory Opinion (AO), the OIG states that a provider should look at the following to determine whether something might skew clinical decision making: (i) whether eligibility for remuneration is conditioned on receiving a service and (ii) whether remuneration to the physician encourages referrals to the provider. As to whether something will increase costs to federal health care programs, a provider should look at whether the patient incentive arrangement will shift costs to federal health care programs. And in addressing the potential for overutilization, a provider should look at whether (i) it is actively marketing the program to attract patients; (ii) the program is being offered before the patient decides to use the provider, and (iii) the offered remuneration is encouraging patients to seek out unnecessary or poor quality of care. These factors help determine whether a patient incentive arrangement carries a low risk of harm.

When discussing activities that facilitate access to care, the OIG says that “promoting access to care” constitutes “improving a particular beneficiary’s, or a defined beneficiary population’s, ability to obtain items and services….” This includes removing “socioeconomic, educational, geographic, mobility or other barriers that could prevent patients from seeking care…or following through with a treatment plan.” However, the OIG is careful to distinguish activities that directly provide access to care from activities that are not directly related. For instance, “providing free child care during appointments…could promote access to care…[while] offering movie tickets to a patient whenever the patient attends an appointment…would be a reward for receiving care and does not help the patient access care….”

The latest OIG guidance on this issue is set out in AO No. 19-03. The scenario described in the AO is as follows:

• The Requestor is a nonprofit medical center that provides inpatient and outpatient hospital-based services.
• The Clinic is an affiliate of the Requestor that offers primary care and certain specialty services at several facilities located in the geographic region that the Requestor serves.
• The Requestor and Clinic are under the control of an integrated health system operating in three states (“Health System”).
• The Requestor has developed a program to provide free, in-home follow-up care to certain patients who the Requestor certifies are at higher risk of admission or readmission to a hospital.
• Under an existing arrangement (“Current Arrangement”), the Requestor offers in-home care to patients with congestive heart failure (“CHF”) who qualify for participation, and under a proposed arrangement (“Proposed Arrangement”), the Requestor would expand the program to qualifying patients with chronic obstructive pulmonary disease (“COPD”).
• According to the Requestor, the goals of both arrangements are to increase patient compliance with discharge plans, improve patient health, and reduce hospital inpatient admissions and readmissions.
• Clinical nurse leaders screen patients to determine if they meet the following eligibility criteria for the Current Arrangement. First, a patient must have CHF and be (i) currently admitted as an inpatient to the Requestor, or (ii) a patient of the Requestor’s CHF Center who was admitted as an impatient to the Requestor within the previous 30 days. Second, the clinical nurse leader must identity the patient as high risk for hospital inpatient readmission using a risk assessment tool utilized throughout the industry to predict the risk of unplanned readmission or emergency department visits subsequent to a hospital discharge. Third, the patient must have arranged to receive follow-up care at the CHF Center. If a patient does not plan to seek follow-up care, intends to receive follow-up services elsewhere, or expresses uncertainty about where he or she will receive follow-up care, then the patient is not informed of the Current Arrangement. Fourth, the patient must be willing to enroll in the Current Arrangement after consultation with the clinical nurse leader. Finally, the patient must be discharged to – or reside at – a personal residence or an assisted living facility (“ALF”) in the Health System’s service area.
• The Proposed Arrangement generally would have the same eligibility requirements as the Current Arrangement.
• The Requestor offers the Current Arrangement, and would offer the Proposed Arrangement, to any patient who meets the eligibility criteria, regardless of the patient’s health insurance status or his or her ability to pay for medical services. The Requestor certifies that it does not, and would not, advertise or market the arrangements to the public. Further, the Requestor does not, and would not, publicize the arrangements on its website.

Under both arrangements, patients who meet all eligibility criteria and who choose to participate receive two visits from a community paramedic each week to for approximately 30 days following enrollment. Each visit takes place in the patient’s home or ALF and lasts approximately 60 minutes, during with time the community paramedic may perform some or all of the following activities (collectively, the “Services”):

• review the patient’s medication;
• assess the patient’s need for follow-up appointments;
• monitor the patient’s compliance with the discharge plan of care or the patient’s disease management;
• perform a home safety inspection; and
• perform a physical assessment, which may include checking the patient’s pulse and blood pressure, listening to the patient’s lungs and heart, checking any wounds, running an electrocardiograph, drawing blood and running blood tests using a portable blood analyzer, or administering medication.

The community paramedic uses a clinical protocol to deliver interventions and to assess whether a referral for follow-up care is necessary. The community paramedic documents all activities and interventions he or she performs during the course of the visit in the patient’s electronic medical record. If a patient requires care that falls outside the community paramedic’s scope of practice, the community paramedic directs the patient to follow up with his or her established provider. For urgent but non-life threatening medical needs, the community paramedic calls the patient’s established provider, and such provider follows up with the patient as he or she deems appropriate.

In many cases, the Requestor or the Clinic is the patient’s established provider. If a patient requires care unrelated to his or her CHF or COPD for which he or she has no established provider, the community paramedic contacts the Requestor or the Clinic, as applicable, to determine if the Requestor or the Clinic can address any immediate needs, but the patient may obtain care from the provider of his or her choice, and the community paramedic informs the patient of this fact. According to the Requestor, this approach fosters integrated care delivery for patients and improves patients’ adherence to their treatment plans, which is particularly important for patients with chronic diseases. The Requestor and the Clinic bill, and would bill, for any follow-up services they provide outside the scope of the arrangements at the same rate that they would bill for such services if the patient was not participating in the arrangements.

The Requestor employs, on either a full-time or part-time basis, the community paramedics who provide the Services. Neither the Requestor nor the Clinic compensates, or would compensate, any employee or contractor based on the number of patients who enroll in the arrangements. All costs associated with the community paramedic visits provided under the arrangements are, and would be, allocated to the Requestor. With one exception, the Services are not covered or reimbursed by federal health care programs when performed by a community paramedic. One Medicaid program reimburses for community paramedic services that Requestor represents are similar to the Services, but the Requestor represents that it does not, and would not, bill this Medicaid program for the Services. Neither patients nor any payors are, or would be, billed for the Services, and the Requestor does not, and would not, shift any costs related to the arrangements to Medicare, Medicaid, other payors, or individuals.

In reviewing the Current Arrangement and the Proposed Arrangement, the OIG observed that the arrangements could potentially violate the federal anti-kickback statute (“AKS”) and the federal beneficiary inducement statute. However, the OIG concluded that it would not bring an enforcement action against the arrangements under these statutes. This conclusion is based on the following:

• The Services provide a significant benefit to patients in the form of free health care services and care management furnished in their homes. As such, the Services constitute remuneration from the Requestor to patients participating in the arrangements.
• This remuneration could influence a patient to select Requestor or the Clinic for federally reimbursable items and services.
• The “Promotes Access to Care” exception under the beneficiary inducement statute does not protect the arrangements.
• Notwithstanding the foregoing concerns, for the reasons set out in the succeeding bullets, the OIG will decline to bring an enforcement action.
• Although the remuneration implicates the beneficiary inducement statute, the OIG believes that the arrangements’ benefits outweigh any risk of inappropriate patient steering that the beneficiary inducement statute was designed to prevent. For example, before learning about the arrangements, patients already must have selected the Requestor or the Clinic for follow-up services related to their CHF or COPD. With respect to future services unrelated to their CHF or COPD, the community paramedics direct patients to follow up with their established provider. Patients are informed that they have the right to choose their provider. Of particular importance is that the arrangements foster integrated care delivery, which is particularly important for individuals with chronic diseases because it improves their adherence to their treatment plans.
• If the arrangements work as intended, they are unlikely to lead to increased costs to federal health care programs or patients through overutilization or inappropriate utilization. To the extent that the arrangements increase utilization of health care services, such an increase likely would reflect appropriate utilization from patients receiving medical necessary care as a result of the arrangements. Further, the arrangements would result in overall savings to federal health care programs if they successfully achieve the goals of improving patient health and reducing hospital inpatient admissions and readmissions.
• The risk that the arrangements will interfere with or skew clinical decision making is low.
• The arrangements would not be marketed or publicized.
• The scope and duration of the Services appear reasonably tailored to accomplish the goals of increasing patient compliance with discharge plans, improving patient health, and reducing hospital admissions and readmissions.

Applicability to DME Suppliers

Health care is evolving from the traditional “fee-for-service” (“FFS”) model to an “integrated care” model. Under the FFS model, health care providers (physicians, hospitals, therapists, pharmacies, DME suppliers, etc.) operate in separate “silos.” Each provider is paid for the services/products it delivers…regardless of whether such services/products result in a positive patient outcome. Plus, in the FFS model, the providers do not coordinate with each other. This approach is expensive and inefficient.

Third party payors (“TPPs”) are pushing providers into the integrated care model. Under this model, providers are expected to coordinate with each other so that they work as a “team” to heal the patient…and then keep the patient healthy. Further, reimbursement is tied to patient outcome. While commercial insurers are on the forefront in pushing the integrated care model, government health care programs are also going down this path.

DME suppliers have a unique role to play in the integrated care model. Unlike most other health care providers, DME suppliers (i) visit their patients’ homes, (ii) communicate regularly with their patients and their caregivers, and (iii) communicate with their patient’s treating physicians. In other words, DME suppliers are in the position to help patients become healthy and, more importantly, to remain healthy.

• With this in mind, a DME supplier can approach a hospital and suggest that the supplier and hospital enter into a preferred provider arrangement in which, subject to patient choice, the hospital will refer discharged patients to the DME supplier. In return, the supplier commits to work with the discharged patients with the goal of improving their health and reducing the risk of readmissions.
• Alternatively, a DME supplier can approach a Managed Care Organization (“MCO”) and ask to be added to the MCO’s plan. As a selling point to the MCO, the DME supplier can describe the array of services it provides and explain that such services are designed to keep the MCO’s covered lives healthy…and out of the hospital.
• A DME supplier can explain to physicians that if they will refer their patients to the supplier, the supplier will go out of its way to keep the patients healthy.

As DME suppliers offer services to patients with the goal of keeping them healthy…and out of the hospital…the suppliers should follow the OIG guidelines set out in AO-19-03.

AAHomecare’s Retail Work Group

The Retail Work Group is a vibrant network of DME industry stakeholders (suppliers, manufacturers, consultants) that meets once a month via video conference during which (i) an expert guest will present a topic on an aspect of selling products at retail, and (ii) a question and answer period will follow. The next Retail Work Group video conference is scheduled for March 28, 2019, at 11:00 a.m. Central. Jeff Baird, Brown & Fortunato, P.C., will present “Diving Deeper into the Legal Aspects of Retail.” Participation in the Retail Work Group is free to AAHomecare members. For more information, contact Ashley Plauché Manager of Government Affairs, AAHomecare ([email protected]).

Jeffrey S. Baird, JD, is chairman of the Health Care Group at Brown & Fortunato, PC, a law firm based in Amarillo, Tex. He represents pharmacies, infusion companies, HME companies and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization, and can be reached at (806) 345-6320 or [email protected].