Advisory Opinion

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On Thursday, February 23, the Office of the Inspector General for the Department of Health and Human Services (“OIG”) issued its first Advisory Opinion (“AO”) of the new year – OIG AO No. 23-01 – permitting a drug manufacturer to provide financial assistance for transportation, lodging, meals, and other out-of-pocket expenses to eligible patients receiving the manufacturer’s drug (the “Arrangement”). Overall, OIG concluded that: (1) the risk of fraud and abuse presented by the manufacturer’s Arrangement was sufficiently low under the Federal anti-kickback statute; and (2) the remuneration offered under the Arrangement was not likely to influence a beneficiary to order the manufacturer’s drug (the “Drug”) from a particular provider and therefore did not constitute grounds for the imposition of sanctions under the Beneficiary Inducements CMP. Ultimately, the crux of this decision came down to the unique manufacturing and distribution of the Drug, which (i) is the only available potentially curative treatment for an ultra-rare disorder; (ii) pursuant to its FDA approval, can only be manufactured at a single facility, located on the campus of a treatment center (the “Treatment Center”); (iii) can only be administered within 3 hours after being manufactured; and thus, can only be administered at the single Treatment Center site.…

Continue Reading OIG Advisory Opinion Alert: Medical Flights for Patient Access

In Advisory Opinion No. 18-11, the Department of Health and Human Services Office of the Inspector General (the “OIG”) addressed a Medicaid managed care organization’s (“MCO”) proposal to pay its contracted providers and clinics (“Network Providers”) to increase the amount of Early and Periodic Screening, Diagnostic, and Treatment (“EPSDT”) services they provide to the MCO’s Medicaid members. Under the State’s MCO program, MCOs are required to provide EPSDT services and face liquidated damages for failing to do so. Under the proposed arrangement, the MCO would provide per member incentive payments (“Incentive Payments”) to Network Providers that meet certain benchmarks for increasing the amount of EPSDT services they provide to MCO members. The amount of the Incentive Payments would be determined based on the percentage increase of EPSDT services provided to the MCO’s existing members from one year to the next.
Continue Reading How Broad is the Managed Care Safe Harbor?