OIG Issues Special Fraud Alert on Physician-Owned Distributorships (PODs)

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On March 26, 2013, the Office of the Inspector General (“OIG”) of the Department of Health and Human Services issued its first Special Fraud Alert in three years. The new Alert focuses on physician-owned distributorships (“PODs”), adding significantly to the agency’s limited-scope 2006 Open Letter —and responding to a public call from the Senate Finance Committee in 2011 that OIG issue more specific guidance in this area.

Apart from PODs themselves, the Special Fraud Alert is of most direct importance to medical device companies and distributors that have sometimes found themselves at loggerheads with PODs, and to hospitals and ambulatory surgical centers with active or prospective PODs. While focused on PODs, the Special Fraud Alert has passages that will be of interest more broadly throughout the industry.

Please see full alert below for more information.

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