OIG Publishes Special Fraud Alert on Medicare Advantage Marketing Arrangements
On December 11, the U.S. Department of Health and Human Services Office of Inspector General (“OIG”) published a Special Fraud Alert warning against suspect payment arrangements involving the Medicare Advantage (“MA”) program which could implicate the Federal Anti-Kickback Statute (“AKS”), the False Claims Act (“FCA”), and other health care fraud and abuse laws. These suspect payment schemes can improperly steer Medicare enrollees to specific MA plans or health care providers based upon financial incentives rather than the enrollees’ needs.
OIG focuses the Special Fraud Alert on two types of remuneration that have been the subject of recent AKS and FCA settlements:
- Medicare Advantage Organization (“MAO”) Payments to Health Care Providers: Payments from MAOs to health care providers or their staff relating to MA plan marketing and enrollment; and
- Health Care Provider Payments to Agents and Brokers: Payments from health care providers (and related entities contracting with or employing health care providers and management services organizations) to agents, brokers, and others in exchange for referring Medicare enrollees to a particular health care provider.
OIG describes several suspect characteristics in these MA marketing arrangements which may indicate a heightened risk of fraud and abuse:
MAOs offering or paying health care providers or their staff remuneration (directly, or indirectly through brokers, agents, or other third-parties) such as
- Bonuses or gift cards in exchange for referring or recommending patients to a particular MAO or MA plan;
- Payments disguised as payments for legitimate services but which are actually intended to be payment for the health care providers’ referral of individuals to a particular MA plan;
- Payments for sharing patient information that may be used by the MAOs to market to potential enrollees;
- Payments contingent upon or that vary based on the demographics or health status of individuals enrolled or referred for enrollment in an MA plan; or
- Payments that vary based on the number of individuals referred for enrollment in an MA plan.
Health care providers offering or paying agents, brokers, or other third-parties remuneration
- That is contingent upon, or varies based on the demographics or health status of individuals enrolled or referred for enrollment in an MA plan;
- To recommend that health care provider to a Medicare enrollee or refer an enrollee to the health care provider; or
- That varies with the number of individuals referred to the health care provider.
This list is not exhaustive, but illustrates OIG’s concern with marketing arrangements that may improperly steer Medicare enrollees to particular providers or MA plans to maximize financial incentives rather than prioritizing an enrollee’s medical needs or considering the enrollee’s potential out-of-pocket costs.
Health care providers who receive any payments from MAOs or who engage the services of agents, brokers, or other marketers should ensure that these arrangements do not exhibit any of the suspect characteristics described in this Special Fraud Alert. Health care providers should also consult experienced health care attorneys to evaluate any marketing arrangements for compliance with applicable federal and state laws. For more information about how this Special Fraud Alert may affect your health care practice or business, contact Jonathan Schall, Esq. at jschall@foxrothschild.com or 215-299-2015.