Federal Register: December 14, 2000 (Volume 65, Number 241)
DOCID: FR Doc 00-31808
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Inspector General Office, Health and Human Services Department
CFR Citation: 42 CFR Part 1001
NOTICE: PROPOSED RULES
ACTION: Medicare and State health care programs:
DOCUMENT ACTION: Notice of intent to develop regulations.
SUBJECT CATEGORY:
Solicitation of New Safe Harbors and Special Fraud Alerts
DATES: To assure consideration, public comments must be delivered to the address provided below by no later than 5 p.m. on February 12, 2001.
DOCUMENT SUMMARY:
In accordance with section 205 of the Health Insurance Portability and Accountability Act (HIPAA) of 1996, this annual notice solicits proposals and recommendations for developing new and modifying existing safe harbor provisions under the Federal and State health care programs' antikickback statute, as well as developing new OIG Special Fraud Alerts.
SUMMARY:
Safe harbor provisions and special fraud alerts; intent to develop regulations,
SUPPLEMENTAL INFORMATION
I. Background
A. The OIG Safe Harbor Provisions
Section 1128B(b) of the Social Security Act (the Act) (42 U.S.C. 1320a7b(b)) provides criminal penalties for individuals or entities that knowingly and willfully offer, pay, solicit or receive remuneration in order to induce business reimbursed under the Federal or State health care programs. The offense is classified as a felony, and is punishable by fines of up to $25,000 and imprisonment for up to 5 years. The OIG may also impose administrative sanctions or exclude violators from the Federal or State health care programs.
The types of remuneration covered specifically include kickbacks, bribes, and rebates, whether made directly or indirectly, overtly or covertly, or in cash or in kind. In addition, prohibited conduct includes not only remuneration intended to induce referrals of patients, but remuneration intended to induce the arranging for or the purchasing, leasing or ordering of any good, facility, service, or item paid for by Federal or State health care programs.
Since the statute on its face is so broad, concern has been
expressed for many years that some relatively innocuous commercial
arrangements are technically covered by the statute and are, therefore,
subject to criminal prosecution. As a response to the above concern,
the Medicare and Medicaid Patient and Program Protection Act of 1987,
section 14 of Public Law 10093, specifically required the development
and promulgation of regulations, the socalled ``safe harbor''
provisions, designed to specify various payment and business practices
which, although potentially capable of inducing referrals of business
under the Federal and State health care programs, would not be treated as criminal offenses under the
[[Page 78125]]
antikickback statute (section 1128B(b) of the Act; 42 U.S.C. 1320a
7b(b)) and would not serve as a basis for a program exclusion under
section 1128(b)(7) of the Act; 42 U.S.C. 1320a7(b)(7). The OIG safe
harbor provisions have been developed ``to limit the reach of the
statute somewhat by permitting certain nonabusive arrangements, while
encouraging beneficial and innocuous arrangements'' (56 FR 35952, July
29, 1991). Health care providers and others may voluntarily seek to
comply with these provisions so that they have the assurance that their
business practices are not subject to any enforcement action under the antikickback statute or program exclusion authority.
To date, the OIG has developed and codified in 42 CFR 1001.952 a total of 21 final safe harbors that describe practices that are sheltered from liability. The OIG is also currently developing a final safe harbor rule addressing ambulance restocking arrangements. B. OIG Special Fraud Alerts
In addition, the OIG has also periodically issued Special Fraud Alerts to give continuing guidance to health care providers with respect to practices the OIG regards as unlawful. These Special Fraud Alerts serve to notify the health care industry that the OIG has become aware of certain abusive practices that the OIG plans to pursue and prosecute, or to bring civil and administrative action, as appropriate. The Special Fraud Alerts also serve as a tool to encourage industry compliance by giving providers an opportunity to examine their own practices. The OIG Special Fraud Alerts are intended for extensive distribution directly to the health care provider community, as well as those charged with administering the Medicare and Medicaid programs.
In developing these Special Fraud Alerts, the OIG has relied on a
number of sources and has consulted directly with experts in the
subject field, including those within the OIG, other agencies of the
Department, other Federal and State agencies, and those in the health
care industry. To date, ten individual Special Fraud Alerts have been
issued by the OIG and subsequently reprinted in the Federal Register.\1\
\1\ See 59 FR 65372 (December 19, 1994); 60 FR 40847 (August 10,
1995); 61 FR 30623 (June 17, 1996); 63 FR 20415 (April 24, 1998);
and 64 FR 1813 (January 12, 1999). The OIG has also issued three
Special Advisory Bulletins64 FR 37985 (July 14, 1999); 64 FR 52791 (September 30, 1999); and 64 FR 61353 (November 10, 1999).
C. Section 205 of Public Law 104191
Section 205 of Public Law 104191 requires the Department to develop and publish an annual notice in the Federal Register formally soliciting proposals for modifying existing safe harbors to the anti kickback statute and for developing new safe harbors and Special Fraud Alerts.
In developing safe harbors for a criminal statute, the OIG is
compelled to engage in a complete and thorough review of the range of
factual circumstances that may fall within the proposed safe harbor
subject area so as to uncover all potential opportunities for fraud and
abuse. Only then can the OIG determine, in consultation with the
Department of Justice, whether it can effectively develop regulatory
limitations and controls that will permit beneficial and innocuous
arrangements within a subject area while, at the same time, protecting
the Federal health care programs and their beneficiaries from abusive practices.
II. Solicitation of Additional New Recommendations and Proposals
In accordance with the requirements of section 205 of Public Law
104191, the OIG is continuing to study safe harbor and Special Fraud
Alert proposals submitted in response to the annual solicitations. Some
of those suggestions have been addressed in the safe harbor rulemakings
published on November 19, 1999 (64 FR 63504 and 64 FR 63518) or are
already under development. The OIG last published a Federal Register
solicitation notice for developing new safe harbors and Special Fraud
Alerts on December 10, 1999 (64 FR 69217). The OIG received 17 timely
filed responses from a crosssection of organizations, associations and
other interested parties. In response to that and previouslyissued
Federal Register solicitation notices, a status report of the public
comments received for new and modified safe harbors is set forth in
Appendix G to the OIG's Semiannual Report covering the period April 1,
2000 through September, 30, 2000.\2\ OIG is currently taking the
recommendations listed in the appendix under advisement and is not
seeking additional public comment on those proposals at this time.
Rather, this notice seeks additional recommendations from affected
provider, practitioner, supplier and beneficiary representatives
regarding the development of proposed or modified safe harbor
regulations and new Special Fraud Alerts beyond those summarized in the appendix to the OIG Semiannual Report referenced above.
\2\ The OIG Semiannual Report can be accessed through the OIG
web site at http://www.dhhs.gov/oig/semann/index.htm.
Criteria for modifying and establishing safe harbor provisions
In accordance with the statute, we will consider a number of
factors in reviewing proposals for new or modified safe harbor
provisions, such as the extent to which the proposals would effect an increase or decrease in
In addition, we will also take into consideration the existence (or nonexistence) of any potential financial benefit to health care professionals or providers that may vary based on their decisions whether to (1) order a health care item or service, or (2) arrange for a referral of health care items or services to a particular practitioner or provider.
Criteria for Developing Special Fraud Alerts
In determining whether to issue additional Special Fraud Alerts, we will also consider whether, and to what extent, those practices that would be identified in new Special Fraud Alerts may result in any of the consequences set forth above, and the volume and frequency of the conduct that would be identified in these Special Fraud Alerts.
A detailed explanation of justifications or empirical data
supporting the suggestion, and sent to the address indicated above,
would prove helpful in our considering and drafting new or modified safe harbor regulations and Special Fraud Alerts.
Dated: December 7, 2000.
June Gibbs Brown,
Inspector General.
[FR Doc. 0031808 Filed 121300; 8:45 am]
BILLING CODE 415201P
FOR FURTHER INFORMATION CONTACT
Joel Schaer, (202) 619-0089, OIG Regulations Officer.