OIG: Nonprofit Hospital Can Offer Free In-Home Services Despite Anti-Kickback Rules

A hospital can provide free home care to reduce readmissions, despite a federal ban on giving patients freebies that could influence their care decisions.

That’s according to a recent advisory opinion from the U.S. Department of Health and Human Services’ (HHS) Office of the Inspector General (OIG).

OIG’s advisory opinion comes in response to a request for guidance from an unnamed nonprofit medical center, who offers free in-home care to patients with congestive heart failure through a program it hopes to expand to include chronic obstructive pulmonary disease (COPD).

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The federal government penalizes hospitals for high readmissions for both conditions, so the home-based offerings are meant to help both the hospital and eligible patients.

While offering patients free in-home care could violate anti-kickback rules prohibiting programs that drive business from patients, the OIG doesn’t see the program as a problem.

“Benefits outweigh any risk of inappropriate patient steering that the [law] was designed to prevent,” OIG wrote in the opinion, in which it noted it would not sanction such a program.

Additionally, the program does not result in increased costs to taxpayers. In fact, it could even save them money by curbing readmissions and keeping patients healthier, the OIG pointed out.

Other reasons OIG approved of the program include that it doesn’t have public advertising, tie patient volume to employee compensation or remove patients’ ability to select their preferred provider.

Giving patients the right to choose their own post-acute care provider has long been a priority for Medicare, which has policies in place to protect patients’ right to choose. However, patients rarely make the best choice.

Last year, the Medicare Payment Advisory Commission (MedPAC) alerted Congress that 94% of beneficiaries have at least one neighbor provider with a higher quality score than the provider they’ve chosen.

Although OIG has deemed free at-home care programs designed to reduce readmissions admissible, such programs are not always successful. In fact, a growing number of hospitals are outsourcing their home health offerings, with workforce and financial challenges driving the decision.

OIG’s advisory opinion pertained specifically to the unnamed nonprofit medical center.

Broadly, the OIG advisory opinion offers important guidance and reassurance to the many health care providers who have implemented or are considering implementing post-discharge and similar support service programs that aim to improve patient health outcomes related to congestive heart failure and COPD, attorneys from Sheppard, Mullin, Richter & Hampton LL note in the National Law Review.

However, it is not clear whether the OIG would have had the same reaction to a proposed post-discharge support program that would apply to a wider range of diagnoses, they argue.

“Despite the potential breadth of the statutory exception for arrangements that promote access to care, in whole or in part, the OIG’s narrower focus leaves the status of post-discharge support programs unnecessarily uncertain,” the attorneys wrote. “Given the long-recognized import of such support programs in improving health outcomes, the introduction of this type of uncertainty is unfortunate and may be counterproductive.”


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