A proposed arrangement under which two companies that provide durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) would: (1) have an inventory of DMEPOS in consignment closets on-site at certain hospitals; and (2) have licensed personnel on-call or on-site at the hospitals to train and educate patients regarding certain equipment after selecting one of the companies as their supplier, did not generate prohibited remuneration under the anti-kickback statute according to the Office of Inspector General (OIG).
Under the arrangement, the companies would not provide remuneration to the hospitals for use of the consignment closets. The chosen supplier would bill the patient and his or her third party payor, including Medicare or Medicaid, for the DMEPOS ordered. The companies would ensure that personnel complied with all requirements for supplying DMEPOS, especially for suppliers of respiratory equipment. The hospitals would provide the licensed DMEPOS personnel with communication equipment to facilitate the coordination of services with the patient's treating physician, other clinicians, and the hospital's discharge planning staff, but would not charge the suppliers for the use of this equipment. The companies would also not have contact with the patients prior to the patients' selection of the supplier for respiratory equipment.
The anti-kickback statue makes it unlawful to knowingly and willfully to offer, pay, solicit or receive remuneration to reward referrals of items reimbursable by a federal health care program. The OIG noted in the advisory opinion that it was concerned about aggressive marketing by DMEPOS suppliers, including marketing activities that involved personal contact with beneficiaries. The activities are considered by the OIG to be highly susceptible to fraud and abuse, as they could lead to overutilization, increased costs to the federal health care program and beneficiaries, and inappropriate medical choices, as well as the adverse effects on the quality of care patients receive. Although the proposed arrangement offered DMEPOS suppliers opportunities for access to hospital staff and patients, and was potentially susceptible to problematic marketing schemes, the OIG found that the proposed arrangement did not violate the anti-kickback statute, because (1) there was no remuneration from the suppliers to potential referral sources, such as the hospitals; (2) patients were free to choose a DMEPOS supplier; and (3) the suppliers would not provide any additional services beyond DMEPOS services. Finally, because the suppliers were only provided services in connection with DMEPOS, and not services that the hospitals were obligated to provide, there is no financial benefit to the hospitals with regard to the presence of the suppliers' personnel at their facilities.
OIG Advisory Opinion, No. 08-20, Nov. 26, 2008; Health Care Compliance Reporter, ¶500,200
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