OIG Approves Free Lodging and Meals Under “Promotes Access to Care” Exception to Beneficiary Inducement CMP | Baker Ober Health Law


In Advisory Opinion 17-01, published March 10, 2017, the Department of Health and Human Services, Office of Inspector General (OIG) approved an academic medical center’s proposal to provide free or reduced-cost lodging and meals to certain financially-needy patients. Based on the specific facts presented, the OIG concluded the proposed arrangement would not constitute grounds for the imposition of civil monetary penalties under the civil monetary penalty against beneficiary inducements (Beneficiary Inducement CMP), or administrative sanctions under the anti-kickback statute.


The advisory opinion is notable in that it marks the first time the OIG has applied the “promotes-access-to-care” exception to the Beneficiary Inducement CMP. To that end, the OIG’s analysis provides a roadmap for analyzing whether an arrangement “promotes access to care and poses a low risk of harm to patients and Federal health care programs,” as required under the exception.


Overview of Facts


An academic medical center (Requester) sought approval to provide free or reduced-cost lodging and cafeteria meals to certain low-income patients receiving services at one of its four hospitals (the Hospital). The Hospital operates a Level I trauma center and provides specialized services such as organ transplants and advanced outpatient oncology. The arrangement would be limited to patients that meet the following criteria:


  • Reside 90 or more miles from the Hospital;

  • Live in either a medically underserved area (MUA) or a health professional shortage area (HPSA) of the Hospital’s state;

  • Have a household income of 500 percent or less of the federal poverty level (FPL) and otherwise meet the Requester’s financial need criteria; and

  • Are either: (a) required to be present for evaluation at the Hospital before 10:00 a.m.; or (b) have a follow-up appointment/surgery at the Hospital within 48 hours of on-site care.


The proposed free or reduced cost-lodging would…

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