The U.S. Department of Health and Human Services’ Office of Inspector General (OIG) has issued a favorable Advisory Opinion for a non-profit foundation receiving donations from an affiliated company. The company in this case offers family-based therapy for children with a redacted “Disorder” (presumably autism), where the goal of the therapy sessions is to train the child’s parents and other caretakers to provide ongoing care and therapy to the child on a daily basis. The therapy is often provided via telehealth to help reduce costs.
The foundation was formed by a few company employees to help qualifying families with the cost of the therapy services. The foundation offers grants to families who qualify for the therapy services and meet other criteria, such as household income limits. Families who apply for a grant are approved on a first-come, first-served basis until the full budget of the grant program is reached. The company has donated approximately $300,000 to the foundation to be used for the grant programs.
In reviewing the facts, the OIG noted that the grants could be considered a form of remuneration that is used to generate referrals to the company for therapy services. However, the OIG concluded that the risks of fraud and abuse are low under the federal Anti-Kickback Statute, and would not constitute grounds for imposing sanctions, because the arrangement is unlikely to lead to overutilization or inappropriate increases in costs to federal healthcare programs. The OIG noted that providers are not incentivized to prescribe more therapy sessions than would be necessary for a child, because the grant funding is paid to the families and does not require families to use it for cost-sharing amounts.
Moreover, the OIG concluded that the arrangement is unlikely to lead to inappropriate steering or unfair competition for the following reasons: (i) donations from the company to the foundation are unrestricted and not contingent on future actions of the foundation, including any referrals from the foundation, and grant recipients are chosen without regard to their choice of therapy providers, (ii) the foundation is a non-profit organization that awards grants in an objective manner, and (iii) a family’s eligibility for the grant is not dependent on their selection of a particular therapy provider, or a provider affiliated with the company. In short, the grant funding is unlikely to influence a family’s decision in choosing the company for therapy services.
