The
Department of Health and Human Services (HHS) Office of Inspector General (OIG)
issued an advisory
opinion (No. 17-08) regarding a company’s written proposal to develop a
state-wide network of nursing facilities that would provide discounts on the
daily rates they charge to private long-term care insurers and the insurers’
policyholders.
The OIG concluded that it would not impose administrative
sanctions under the anti-kickback statute or the civil monetary penalties
provision of the Social Security Act because the risk of improper inducement,
fraud, and abuse was sufficiently low under the proposed plan.
A
startup company was proposing to develop a network of nursing facilities that
would provide discounts on the daily rates they charge to private long-term
care insurers that contracted with the company and with participating payors’
policyholders. Facilities that maintain a quality rating of 3 stars or higher
on the CMS Nursing Home Compare website and that agree to provide a set
discount off of its daily private payor rate for a semi-private room covered by
the participating payor, would be eligible to join the network.
Two-thirds of
the discount would be allocated to the participating payor’s liability and
one-third would be allocated to any amount the policyholder would owe to the
facility. Each time a participating payor receives a discount from a facility,
the participating payor would pay the startup company a fee for administrative
services.
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