October 24, 2018

Paying physicians to boost screenings isn't an illegal kickback, HHS opinion suggests

Daily Briefing

    A Medicaid managed care insurer can pay doctors bonuses to increase preventive screenings and it won't be considered kickback, according to an advisory opinion HHS' Office of Inspector General (OIG) published last week.

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    Insurer asks, 'Can we do this?'

    An unnamed health insurer recently reached out to OIG with a proposal to boost early and periodic screening, diagnostic, and treatment services.

    The insurer noted that under the terms of its contract with the state Medicaid agency the insurer has to provide screenings to 85% of enrollees younger than one-year old and to 75% of its enrollees ages one to 21. These screenings can include examinations of physical and mental health, growth, development, and nutritional status as well as vision and hearing tests.

    To meet that goal, the insurer proposed giving incentive payments to in-network physicians. The more the provider increased screening rates over the 2018 baseline, the more they'd receive in incentive payments. The insurer proposed giving physicians a $1-per-enrollee bonus for increasing screenings by at least 10%, a $2-per-enrollee bonus for increasing screenings by at least 20%, and $3-per-enrollee for increasing screenings by at least 30%.

    The insurer explained that the incentive would not be used to recruit new beneficiaries and would not encourage providers to participate in the insurer's other lines of business, such as Medicare Advantage.

    The insurer said it would pay the incentive payments itself and they would not come from a state Medicaid agency.

    HHS: Yes

    HHS in a public advisory opinion said the insurer's proposal would not violate the federal Anti-Kickback Statute. The advisory opinion is legally binding—so HHS won't pursue legal action on the matter.

    HHS wrote, "Based on the facts certified in your request for an advisory opinion and supplemental submissions, we conclude that the proposed arrangement would not generate prohibited remuneration under the anti-kickback statute."

    HHS in the opinion noted that the ruling applies only to the insurer that requested the rule. HHS said the ruling does not apply to other entities (HHS advisory opinion, 10/18; Dickson, Modern Healthcare, 10/19; Ellison, Becker's Hospital Review, 10/22).

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