HHS OIG Issues Advisory Opinion 24-02, Focused on Patient Assistance Funds
The United States Department of Health and Human Services (HHS) Office of Inspector General (OIG) issued Advisory Opinion 24-02, regarding patient assistance funds associated with 12 specific diseases (“disease funds”). The Requestor specifically sought information on whether the proposed arrangement would trigger sanctions under the civil monetary penalty provision at section 1128A(a)(7) of the Social Security Act.
According to the Requestor, Requestor is a 501(c)(3) nonprofit that provides financial support to patients with certain medical conditions and a demonstrated financial need through various patient assistance programs. Each of the involved disease funds is designed around a clinically recognized disease state and is not narrowed to cover only specific treatments, drugs, symptoms, stages of a particular disease, or degrees of disease severity. Each of the 12 involved disease states are considered to be a “rare disorder” that impacts less than 200,000 Americans. Additionally, each of the disease funds has a single donor pharmaceutical manufacturer that manufactures or markets a drug to treat the disease state addressed by the disease fund. The disease funds help patients with out-of-pocket costs associated with the treatment of the disease as well as the disease’s symptoms and the side effects of treatment.
Requestor noted that it publicizes the disease funds to relevant communities and advocacy groups as well as to the general public. Patients are able to apply for enrollment in a disease fund through the Requestors website, by phone, or by email, and the application process requires documentation of financial and medical eligibility. Requestor notes that a patient’s eligibility is not contingent on the selection of a particular treating physician or pharmacy, or whether the patient has been prescribed any particular drug or treatment approach.
Requestor also indicated that it enters into a written agreement with each donor. The written agreements specify that the donor will not exert any influence or control over the identification, delineation, establishment, or modification of any specific disease funds operated by the Requestor. Requestor also does not establish, delineate, or modify disease funds at the request or suggestion of donors or potential donors (or their affiliates).
OIG concluded that patient assistance programs can “provide important safety net assistance to patients, especially patients who cannot afford their cost-sharing obligations for prescription drugs.” OIG also emphasized support for efforts of charitable organizations and others to assist financially needy beneficiaries, provided the assistance does not run afoul of the Federal anti-kickback statute or other laws. However, patient assistance programs that heavily rely on donations from pharmaceutical manufacturers present significant fraud and abuse risks. Therefore, OIG has “consistently warned” that patient assistance programs should be independent of any pharmaceutical manufacturer influence and “not function as a conduit for payments by the pharmaceutical manufacturer to patients.”
After a review of the facts presented, HHS OIG stated that during the Effective Period, the Arrangement would generate prohibited remuneration under the Federal anti-kickback statute if the requisite intent were present, but OIG will not impose administrative sanctions on Requestor in connection with the Arrangement under sections 1128A(a)(7) or 1128(b)(7) of the Act. HHS OIG further concluded that the Arrangement does not constitute grounds for the imposition of sanctions under the Beneficiary Inducements CMP or section 1128(b)(7) of the Act, as that section relates to the commission of acts described in the Beneficiary Inducements CMP.
As we often see, the opinion may not be relied on by anyone other than the Requestor. The advisory opinion is in force and effect only until January 1, 2027 (the “effective period”).