In June 2022, the United States Department of Health and Human Services Office of Inspector General (HHS OIG) released OIG Advisory Opinion No. 22-14. HHS OIG was responding to a written request for an advisory opinion regarding a proposed continuing medical education program for local optometrists conducted by an ophthalmology group practice and four potential funding options for the programs. The requestor wanted to know if the proposed funding options would violate the federal anti-kickback statute or any other laws.
Under each of the proposals, the Requestor would offer two annual continuing education programs about the new technologies and pharmacological treatment protocols applicable to ophthalmic surgery patients. The programs would be offered in the form of a full-day program and a shorter evening program, each designed to meet state continuing education requirements. The programs would be advertised and made available to all optometrists in the Requestor’s service area and the Requestor’s own providers – along with faculty members from professional schools – would serve as the speakers. Any outside speakers would be paid an honorarium plus expenses at fair market value, which would not account for the volume or value of past or potential business generated for the Requestor or any industry sponsor.
Under the first funding option, Proposed Arrangement A, the Requestor would cover all continuing education program costs and charge attendees a fair market value registration fee. Under the second option, Proposed Arrangement B, Requestor would cover all continuing education program costs with no registration fee or outside funding. Proposed Arrangements C and D would include funding for the continuing education programs from industry sponsors – under Proposed Arrangement C, Requestor would not charge a registration fee to CE program attendees, but under Proposed Arrangement D, Requestor would charge a registration fee to program attendees that would be subsidized by the funding received from industry sponsorships for the programs.
HHS found that Proposed Arrangement A, would “generate prohibited remuneration under the Federal anti-kickback statute if the requisite intent were present,” but “the OIG would not impose administrative sanctions on Requestor in connection with Proposed Arrangement A under sections 1128A(a)(7) or 1128(b)(7) of the Act, as those sections relate to the commission of acts described in the Federal anti-kickback statute.”
HHS OIG does find, however, the Proposed Arrangements B, C, and D, would “generate prohibited remuneration under the Federal anti-kickback statute, if the requisite intent were present, which would constitute grounds for the imposition of sanctions under sections 1128A(a)(7) and 1128(b)(7) of the Act.”
OIG noted that because the Requestor would provide something of value (the continuing education programs) to local optometrists who are able to refer patients to the Requestor for surgery. Under Proposed Arrangements C and D, the Requestor, external faculty members and attendees would also receive remuneration from Manufacturers for such products. HHS OIG stated that “CE programs that are educational in nature, … may constitute a vehicle to provide remuneration to referral sources in violation of the Federal anti-kickback statute in some circumstances.”
HHS OIG also referenced the 2020 Special Fraud Alert aimed at educational programming, noting that “the CE programs [covered in the Advisory Opinion] as a general matter do not exhibit the types of suspect characteristics highlighted in the SFA.” Specifically, HHS OIG notes that the CE programs would be approved for CE credit by professional CE certification boards, only modest food items would be provided, the venue would be in an “appropriately sized conference space,” and the CE programs would be open to all local optometrists, among other considerations.
Importantly, HHS OIG noted that the advisory opinion “is limited to the relevant facts presented to us by Requestor in connection with the Proposed Arrangements” and that “this opinion may not be relied on by any person other than Requestor.”
What Does This Mean?
Arnold & Porter Client Advisory
Arnold & Porter issued a client advisory in response to the Advisory Opinion. In it, attorneys Mahnu V. Davar, Jeffrey L. Handwerker, and Abraham Gitterman, note that “overall, Advisory Opinion 22-14 does not change OIG’s historic position” that support for educational activities that are sponsored and organized by medical professional organizations “raise little risk of fraud and abuse” when the arrangements are structured to comply with the 2003 OIG Compliance Program Guidance for Pharmaceutical Manufacturers, the 1997 guidance from the United States Food and Drug Administration (FDA), and the ACCME Standards for Integrity and Independence.
Arnold & Porter also reiterated that while the “advisory opinion is limited to the facts certified and applicable only to the requestor,” manufacturers and education providers “may wish to consider the implications of this advisory opinion for their practices.”
Holland & Knight
In its published insight, Holland & Knight noted that OIG “has long utilized the concept of ‘substantial independent value’ in evaluating whether the provision of any free or reduced-cost goods or services to a potential referral source of federal healthcare program business poses heightened risks under the AKS.” The author further notes that in this HHS OIG advisory opinion, OIG applies the same concept “in the context of free educational programs, showing that even bona fide educational programs could pose heightened risks of fraud and abuse.”
They went on to note, though, that reviewing the OIG analysis of all four Proposed Arrangements serves as a good reminder that an analysis under the AKS “is truly a facts-and-circumstance analysis, involving a detailed review of each proposed arrangement, the type and amount of ‘remuneration’ involved and the parties implicated in the arrangement.”
Morgan Lewis
Morgan, Lewis & Bockius also issued an advisory, in which they noted that with respect to healthcare transaction due diligence, buyers should ask about the target’s marketing and business development activities to identify ant sponsored continuing education program activities. Then, the programs should be “thoroughly reviewed to detect any behavior that could generate material AKS risk.”
Bass, Berry & Sims
Bass, Berry & Sims issued a firm publication, noting that the HHS OIG opinion “reinforces OIG’s concerns with free CE programs, applies recent OIG guidance related to speaker programs funded by pharmaceutical and device manufacturers to programs organized by physicians, and leaves some confusion around the impact of fair market value (FMV) payments for CE.”
ACCME Statement
Graham McMahon, MD, Presiden and CEO of ACCME has also acknowledged the OIG opinion, saying, “We observe that the organization that requested the opinion did so around a very specific set of facts and circumstances that are unlikely to be extrapolated to other organizations and their activities. At this time, there have been no changes in the federal Anti-Kickback Statute that ACCME is aware of since we received this clarification from CMS in 2008 that acknowledges that accredited CME is not considered remuneration or subject to Stark restrictions. We suggest that CME providers review any specific scenarios in which they are engaged with their own legal counsel if they have concerns.”