OIG-HHS approves rewards program for referrals of residents to continuing care by employees and residents

by Ben Vernia | June 5th, 2010

In an advisory opinion posted on May 27, 2010, Lewis Morris, the Chief Counsel to the OIG-HHS, blessed a proposed resident referral program by the operator of several continuing care retirement communities (CCRCs).

The Requestor’s CCRCs have three levels of care available to residents: independent living, assisted living, and skilled nursing. Once residents move in, they may move among the levels of care as needed. Under the proposed program, residents and employees of the CCRCs who referred prospective residents to the independent living program of the CCRC would receive gift cards or other rewards, but no incentives would be given for referrals to assisted living or skilled nursing.

The OIG-HHS reasoned that since no reimbursable services were provided to independent living residents, risk of violation of the anti-kickback statute would arise only if a referred resident transferred from independent living to either assisted living or skilled nursing, where the CCRCs do provide reimbursable services.

Finding that the proposed program would not violate the anti-kickback statute, the OIG found three factors persuasive:

  • When making a referral under the proposed program, the referring resident or employee would be “acting as a friend or acquaintance making a general recommendation about an overall lifestyle decision.”
  • Although the availability of assisted living and skilled nursing “could be a factor in the prospect’s decision, numerous other aspects of the CCRC . . . would also be influential.”
  • The proposed program “would have no impact on any health care professional’s decision to order a health care item or service or to refer a patient to a particular practitioner, provider, or supplier.”

The OIG concluded that the proposed program would not violate the anti-kickback statute, and that it would therefore not impose administrative sanctions in connection with the program.

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