OIG Approves Marketing Program Offered by Technology Company to Health Care Providers
Health Care Law Update
Date: September 23, 2019
In an advisory opinion posted on September 11, 2019, the Office of Inspector General of the Department of Health and Human Services (OIG) concluded that a marketing arrangement proposed by a technology company (the “Requester”) presented a low risk of fraud and abuse under the Anti-Kickback Statute.
The Requester operated a marketplace platform (the “Marketplace”) that allowed users to search for and book medical appointments with health care professionals (“Providers”) based on the user’s criteria, such as geographic area, preferred appointment time and the user’s medical insurance. The Marketplace would then generate up to 200 personalized search results listing health care providers meeting the criteria identified by the user (“Marketplace Results”).
The Requester proposed charging Providers three types of fees for participating in the Marketplace:
- A “per-booking” fee that applied when the user booked an appointment with Provider through the Marketplace and indicated that he or she was a new patient of the Provider.
- A “per-click” fee that applied each time a user clicked on the Provider’s Marketplace Result.
- A “per-impression” or “per-click” fee that applied to any sponsored banner advertisement purchased by the Provider on the Marketplace Results page (“Sponsored Results”).
The OIG noted that the proposed arrangement implicated the Anti-Kickback Statute because, through the scheduling services, the Requester would be “arranging” for the furnishing of federally reimbursable items and services in exchange for the per-booking or per-click fees. In addition, Requester’s display of the Marketplace Results and the Sponsored Results constituted advertising activities meant to induce the use of an item or service which, in some cases, would be reimbursable by a federal health care program. For several reasons, though, the OIG determined the arrangement posed a low risk of fraud and abuse:
- The Requester certified that each fee amount was set in advance, and the aggregate fees paid by Providers to be listed in Marketplace Results would not exceed fair market value, as determined by a third-party valuation firm. The per-click fees would not take into account the volume or value of any business generated for Providers through the Marketplace, and the per-booking fees would not vary based on the volume or value of federal health care program business generated by the Marketplace. A Provider’s listings in Marketplace Results would depend only on user-centric criteria, and a Provider would not appear more frequently in the Marketplace Results, or have more favorable placements, as a result of paying higher fees.
- The Requester was not a health care professional in a position of trust who could exert undue influence when recommending health care-related items or services, nor would Requester recommend any particular Provider, item or service.
- Requester’s advertising activities would not specifically target federal health care program beneficiaries. Any contact with the Requester would need to be initiated by a federal health care program beneficiary. Unlike more direct forms of advertising, such as emails, mailings or text messages, Requester’s advertisements would be visible to federal health care program beneficiaries only if they were to visit the Marketplace. The Sponsored Results would be clearly marked as paid advertising, and Sponsored Results would include more pronounced lettering and conspicuous coloration when Requester determines that a user is a federal health care program beneficiary.
- The marketing activity would not relate to any specific items or services users may obtain from Providers as a result of appointments booked through the Marketplace. Additionally, Providers would not be prioritized based on the amount Providers pay Requester or any other non-user-centric criteria.
- The potential user base was the general public – any individual, regardless of insurance status, could access the Marketplace, and the fees charged to Providers would be the same regardless of the insurance status of the user.
- Requester would not provide anything of value to federal health care program beneficiaries to induce them to use the Marketplace or that might otherwise serve to influence their selection of a health care professional.
In this advisory opinion, the OIG confirmed once again that non-health care professionals, such as technology or software companies, are subject to the Anti-Kickback Statute if they provide advertising or marketing services to health care professionals. Proper safeguards can reduce the risk under the statute, though. While advisory opinions are issued only to the requesting party and may not be relied upon by any other individual or entity, they can be instructive in analyzing proposed business arrangements under the Anti-Kickback Statute.
FOR MORE INFORMATION
For more information, please contact:
Cori R. Haper
Rebeccah C. Raines
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 The Anti-Kickback Statute makes it a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce or reward referrals of items or services reimbursable by a federal health care program, or arrange for or recommend the purchasing or ordering any good or service for which payment may be made in whole or in part under a federal health care program. Section 1128B(b) of the Social Security Act. Where remuneration is paid purposefully to induce or reward referrals of items or services payable by a federal health care program, the Anti-Kickback Statute is violated.
 In evaluating marketing or advertising arrangements, the OIG considers a number of factors, such as the amount and structure of the compensation, the identity of the party engaged in the marketing activity, the party’s relationship with its target audience, the nature of the marketing activity, the item or service being marketed, the target population, and any safeguards to prevent fraud and abuse (citing OIG Compliance Program Guidance for Pharmaceutical Manufacturers, 68 Fed. Reg. 23731, 23, 739 (May 5, 2003)).