Issued May 19, 2011, and posted May 206, 2011
Written by Joe Kahn; reviewed by Catherine Martin*
On May 19, 2011, the U.S. Department of Health and Human Services, Office of Inspector General (OIG) issued a Notice of Modification (Notice) related to Advisory Opinion 10-07, which OIG originally issued on May 26, 2010 (AO 10-07). In the Notice, OIG approved the proposed modifications to the arrangement covered by AO 10-07.
Under the arrangement addressed by AO 10-07, the requestor may provide financial assistance to needy patients, including Federal healthcare program beneficiaries, who have been diagnosed with multiple sclerosis, cancer, or rheumatoid arthritis. (See summary of AO 10-07.) The requestor sought to modify the arrangement in two ways: (1) establish a process for creating new assistance grant programs for additional diseases; and (2) provide assistance not just for cost-sharing obligations and genetic testing, but also for health insurance premiums associated with coverage for the identified diseases.
With respect to the first proposed change, the requestor proposed to establish and operate new grant programs for additional diseases in the exact same manner, and subject to the same safeguards, by which the original programs addressed in AO 10-07 were established (or were proposed to be established). Because the proposed change would not change the basis for OIG's holding in AO 10-07, OIG determined that the proposed change would not affect its original determination that the arrangement would not result in the imposition of civil monetary penalties or administrative sanctions.
With respect to the second proposed change, the requestor again proposed to structure the additional benefits in accordance with the same safeguards described and approved by OIG in AO 10-07. With respect to the premium coverage, the requestor would pay the assistance directly to the insurance provider where possible. Where such direct payment is not permitted, the requestor would make payment to the grant recipient only upon proof that the cost was incurred. OIG again found that the proposed change would not affect its original determination that the arrangement would not result in the imposition of civil monetary penalties or administrative sanctions.
OIG concluded that AO 10-07 remains in full force and effect as modified pursuant to the Notice.
*The Fraud and Abuse Practice Group Leadership would like to thank Advisory Opinion Task Force Members Joseph Kahn, Esquire (Nexsen Pruet PLLC, Greensboro, NC), and Catherine A. Martin, Esquire (Adelman Sheff & Smith LLC, Annapolis, MD), for respectively drafting and reviewing this summary.