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OIG Increases Threshold for Gifts to Medicare/Medicaid Beneficiaries

Posted in Fraud and Abuse, Legislation and Public Policy, Medicare and Medicaid

On December 7, the Department of Health and Human Services’ Office of Inspector General (OIG) issued a “Policy Statement Regarding Gifts of Nominal Value To Medicare and Medicaid Beneficiaries” which increased the dollar value of gifts that can be offered or transferred to a Medicare or Medicaid beneficiary without the giver potentially incurring liability.

Pursuant to the Social Security Act (the Act) and the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the OIG may impose civil monetary penalties on a person who offers or transfers any remuneration to a Medicare or Medicaid beneficiary that such person knows is likely to influence the beneficiary’s selection of provider. “Remuneration” is defined to include waivers of copayments and deductible amounts and transfers of items or services for free or for other than fair market value. 

In the Conference Committee report accompanying the enactment of the prohibition, Congress stated that it did not intend inexpensive gifts of “nominal value” to be considered improper under the Act. In a final rule published in 2000 and a Special Advisory Bulletin published in 2002, the OIG had previously expressed the position that “nominal value” meant no more than $10 per item, or $50 in the aggregate per patient on an annual basis.

In the new Policy Statement, the OIG has increased the figures from 2000 such that gifts with a retail value of $15 per item and $75 in the aggregate, per patient on an annual basis, will be considered “nominal” and can be offered to a beneficiary without the threat of civil monetary penalties. Consistent with previous interpretations, the incentives may not be in the form of cash or cash equivalents.

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