Is It OK to Give Patients Free Services?


It’s commonly accepted that if a provider gives a Medicare patient free services, it could be considered a kickback and end up landing the provider in hot water. But what if the free services encourage better access to care or improve a patient’s life? Thanks to a recent HHS Office of Inspector General final rule, providers will be able to offer certain free services without running afoul of the law.

The beneficiary inducements civil monetary penalty essentially prohibits providers from giving free services to Medicare and Medicaid beneficiaries if they know the services are likely to influence where the patient receives care. The final rule carves out several exceptions, including allowing patients to receive services such as free health screenings that promote access to care, and allowing for free services to financially needy patients.

Ellyn Sternfield, an attorney with Mintz Levin in Washington, told me that the Affordable Care Act clarified that any inducements to Medicare or Medicaid patients that promoted access to care and posed a low risk of harm should be allowed.

"Much has been made in recent years that government programs have focused too much on paying for the provision of health-care items and services, and not focused on rewarding actions that promote wellness,” Sternfield said.

However, Sternfield said the final rule doesn’t allow for any free services that reward patients for sticking with their treatment, so providers will have to be careful in distinguishing between free services that promote better care and those that merely reward patients’ adherence to their therapy.

“The difference may swing on how the health-care provider documents and presents its program, so in other words, words may matter,” Sternfield said.

Stay on top of new developments in health law and regulation with a free trial to the Health Law Resource Center.

Learn more about Bloomberg Law and sign up for a free trial.