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Government Releases Advisory Opinion on Travel Assistance and Paying for Deductibles, Co-Pays and Premiums

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at June 4, 2015

The U.S. Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) today released a very interesting Advisory Opinion (OIG Advisory Opinion No. 15-06) which seems to imply that a non-profit entity can provide financial assistance including travel and payment for insurance premiums for persons with chronic diseases, under very specific circumstances.

With regard to Substance Use Disorder (SUD), it is universally recognized that SUD is a chronic, often fatal disease.

While this opinion is limited solely to the facts provided and only provides limited protection to the party requesting the opinion (the “Requestor”), it does provide us with just a little more insight as to that gray area we all call Behavioral Health Care compliance.

According to the opinion, the “Requestor” is a 501(c)(3) charitable entity that proposes to establish a patient assistance program to provide financial assistance to individuals with cost-sharing obligations for prescription drugs or devices, health insurance premiums, incidental expenses (e.g., travel expenses, ongoing testing), or a combination thereof, associated with the treatment of various chronic diseases.

Requestor would establish multiple disease funds under the Proposed Arrangement. For each disease fund, Requestor would assess a patient’s eligibility for financial assistance based on the Federal poverty guidelines. Each fund’s eligibility criteria would be uniformly applied to all applicants; financial assistance would be awarded on a first-come, first-served basis to any financially qualified patient, to the extent funding is available.

Patients would be required to notify Requestor if their financial situations changed during the financial assistance period.

Requestor intends to subcontract out the benefits verification function to an unaffiliated vendor.

Requestor certified that no personnel or agents of such vendor would determine (or assist in determining) the structure of any disease fund or the criteria used to determine eligibility for assistance for a particular fund.

Longstanding OIG guidance makes clear that industry stakeholders can contribute effectively to the health care safety net for financially needy patients, including Federal health care program beneficiaries, by contributing to independent, bona fide charitable assistance programs.

The reason OIG felt comfortable in this instance of finding no violation of the law was as follows:

  • First, no Donor or affiliate of any Donor would exert direct or indirect control over Requestor or its patient assistance program;
  • Second, before applying for assistance, each patient already would have selected his or her health care provider, practitioner, or supplier, and already would have a treatment regimen in place; and
  • Third, Requestor would not provide Donors with any data that would facilitate a Donor in correlating the amount or frequency of its donations with the amount or frequency of the use of its drugs, devices, or services.

With regard to the Requestor’s proposed provision of financial assistance with copayment obligations, and in some disease funds, with insurance premiums and incidental expenses, for certain eligible, financially needy patients, including Federal health care program beneficiaries, the OIG found the proposed arrangement “presents a low risk of fraud and abuse and is not likely to influence any beneficiary’s selection of a particular provider, practitioner, supplier, product, or service,” based on the following factors:

  • First, Requestor’s determination of a patient’s qualification for financial assistance would be based solely on his or her financial need, without considering the identity of any of his or her health care providers, practitioners, suppliers, drugs, or devices; the identity of any referring party; or the identity of any Donor that may have contributed for the support of the patient’s disease or the amount of the donation;
  • Second Requestor would provide assistance based on a reasonable, verifiable, and uniform measure of financial need that would be applied in a consistent manner; and
  • Third, Requestor would assist all eligible, financially needy patients on a first-come, first-served basis, to the extent funding is available. Patients would not be eligible for assistance unless they meet Requestor’s financial need eligibility criteria.

As explained above, all patients already would have selected a provider, practitioner, or supplier, and have a treatment regimen in place at the time they apply for assistance, and would remain free to change their provider, practitioner, supplier, drug or device therapy, or insurance plan. Eligibility determinations would be made in a consistent, uniform manner and would not be based, in whole or in part, on whether a patient’s provider, practitioner, or supplier has made contributions to Requestor’s patient assistance program. Requestor would not refer patients to, recommend, or arrange for the use of any particular practitioner, provider, supplier, drug, device, or plan. Patients would not be informed of the identity of Donors.

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