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Medicare Compliance & Reimbursement

Compliance:

Follow These 5 Strategies When Providing Freebies to Patients

Published on Sat Jun 12, 2010

Would offering free dietary counseling be okay in this scenario?

Offering free services or items can be a boon for patient care, but you have to follow certain rules if you don't want the government to lower the boom on you. Consider these key approaches to stay on the right side of the compliance line.

1. Keep an eye on the value of the service or item and how you promote it. "Under the HIPAA beneficiary inducement provisions, you can provide $10 worth of free services/products per encounter with a total of $50 a year," says attorney Lisa Ohrin in Washington, D.C.

Example: Suppose a cardiovascular practice offers Medicare patients 10 minutes each of free dietary counseling during a cardiovascular work-up. The patients can receive the free counseling on a one-time basis. The practice pays the dietitian providing the counseling $50 an hour, which is the going market rate in that area.

Based on the dietitian's hourly compensation, the practice is providing under $10 worth of counseling, Ohrin says. And she thinks Medicare wants to see physicians offering that kind of service when they make a conscious effort to ensure it doesn't exceed the nominal-value threshold. "CMS wants to see physicians providing patient-centered, holistic care" -- not "bare-bones medicine," she says.

Caveats: The provider should be very careful, however, when providing an organized program like the dietary counseling -- especially "when it's advertised to push the provider's" services, says Charles Root, PhD, president of CodeMap in Barrington, Ill. Root, in fact, provided the cardiovascular practice example above as one he encounters as a consultant. In spite of the cautionary note, Root agrees that providing that kind of service can be quite helpful to patients. It "may help them comply with dietary restrictions by giving them that extra motivation."

Remember: Advertising a free service can trigger anti-kickback concerns. And "there's no nominal value exception to the anti-kickback statue," which also applies to beneficiary inducement, says attorney Robert Belfort, with Manatt, Phelps & Phillips in New York City. "Typically the government goes after a payment to a referral source -- not a patient," although the anti-kickback law covers both, he says.

2. Know what you're doing with health fairs. Health fairs can provide an important community service. But they also raise concerns about beneficiary inducement, depending on "how aggressive the provider is in using the fair to drive business to the hospital, etc.," says Belfort. And free screenings aren't necessarily going to meet the nominal value exception allowed by the OIG.

But the screening and preventive services may fall under a separate exception related to beneficiary inducement, says Belfort. The U.S. Department of Health and Human Services maintains the list of preventive services, which includes prenatal care, immunizations, and certain screening tests, he adds.

3. Don't get carried away with free transportation. Healthcare systems often provide patients free bus or van rides from building to building on their campuses. And a lot of these programs "are premised on the assumption that the value of the service is less than $10," says Belfort. "But nobody typically tracks whether someone uses a bus, for example, enough times to exceed the $50 limit."

The good news: The OIG put out an advisory opinion on free transportation a couple of years ago that gave the impression that the government isn't going to aggressively pursue that issue -- "unless the transportation program is egregious," says Belfort. In other words, steer clear of providing luxury transportation, advertising the transportation -- or using it to target certain groups of patients.

4. Keep an eye on the price tag for incentive gifts. Belfort has recently been seeing certain providers give patients small gifts for hitting their target healthcare goals. In his experience, those using the incentive approach tend to be substance abuse treatment providers or caregivers treating non-compliant populations. "For example, the provider offers a gift if the person stays in care for six months," says Belfort. He doesn't see as the intent behind this effort as "bad." But the organization has to be careful not to provide an incentive gift exceeding $10 at any one time or $50 annually.

Example: A provider could give patients a $10 movie ticket every quarter for attending their physician visits, says Belfort. The provider could not, however, provide $18 worth of tickets at one time, even though the provider didn't surpass the $50 yearly limit.

A way out: Providers who want to exceed that cap could attempt to get an OIG Advisory Opinion sanctioning the arrangement, says Belfort. The "OIG has issued a favorable opinion for one such arrangement," he says.

5. Watch out for state laws. If you think beneficiary anti-inducement provisions apply just to Medicare or Medicaid patients, you may be in for a surprise. Some state laws apply the same concepts to private payers, says Belfort. "The majority of states don't have such laws, but some do," he cautions.

Resource: For a review of the OIG's stand on beneficiary inducement, go to www.oig.hhs.gov/fraud/docs/alertsandbulletins/SABGiftsandInducements.pdf.

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