On June 23, 2022, OIG issued Advisory Opinion No. 22-14 in which it responded to a request for an advisory opinion regarding an ophthalmology practice’s proposal to offer continuing education (CE) programs for local optometrists (Proposed Arrangements) within the context of the federal Anti-Kickback Statute (AKS). In providing a partially favorable opinion as detailed below, OIG shed further light on the concepts of free or reduced-cost goods or services and “substantial independent value” under the AKS.

Factual Background

Requestor is an ophthalmology practice which specializes in cataract and refractive surgery, with one ophthalmologist performing surgical procedures and three optometrists providing primary eye care in support of these surgeries. Under the Proposed Arrangements, Requestor would offer, on an annual basis, two CE programs to local optometrists that would address new technology and pharmacological practice treatment protocols relevant to treating patients who require ophthalmic surgeries, including Requestor’s patients. The course options would consist of a full-day CE program providing 6 hours of CE credit and an evening CE program providing 2 hours of CE credit. Requestor would design the programs to meet requirements for CE certification for optometrists in its state.

Requestor proposed four potential options to fund the CE programs:

• Arrangement A: Requestor would cover all CE program costs and charge attendees a fair market value registration fee.
• Arrangement B: Requestor would cover all CE program costs with no registration fee or outside funding.
• Arrangement C: Requestor would not charge any registration fee to attendees, but instead seek funding from industry sponsors (e.g., medical device and pharmaceutical companies). If the funding from sponsors results in a shortfall, the Requestor would cover the difference. If the funding results in an overage, any such amounts would be donated to a local charity.
• Arrangement D: Requestor would charge a registration fee to attendees, and seek funding from industry sponsors (e.g., medical device and pharmaceutical companies). Again, if the revenue from the registration fees and sponsors results in a shortfall, the Requestor would cover the difference and, if they result in an overage, any such amounts would be donated to a local charity.

Legal Analysis

OIG determined that each of the above the Proposed Arrangements could generate prohibited remuneration under the AKS and the beneficiary inducement provision of the civil monetary penalties law. However, OIG stated that it would not impose administrative sanctions on Requestor in connection with Arrangement A, but did state that Proposed Arrangement B, Proposed Arrangement C, and Proposed Arrangement D, if undertaken, would generate prohibited remuneration under the AKS, if the requisite intent were present, which would constitute grounds for the imposition of sanctions. OIG analyzed each Proposed Arrangement separately under the AKS, as follows:

• Arrangement A: OIG concluded that this arrangement presents a sufficiently low level of risk under the AKS because Requestor certified that the registration amounts Requestor proposes to charge and the anticipated number of attendees comport with the estimated amount of expenses, such that any revenue shortfall or overage should not be substantial. Further, there would be no industry sponsors or sources of funding other than the registration fees and, in certain circumstances, Requestor’s contribution to cover remaining expenses.
• Arrangement B and Arrangement C: OIG concluded that these arrangements pose more than a minimal risk of fraud and abuse because the CE program would be entirely free to all local optometrists who may be in a position to refer federal healthcare program business to the Requestor. OIG noted that it has a longstanding concern about the provision of free goods or services to an existing or potential referral source. The provision of goods or services that have independent value to the recipient or for which the recipient would otherwise pay confers a benefit on the recipient. With respect to Requestor’s funding under Proposed Arrangement B and Proposed Arrangement C, there is heightened risk this remuneration could induce the optometrist attendees and external faculty to refer surgical patients, including Federal health care program beneficiaries, to Requestor, which could result in inappropriate patient steering.
• Arrangement D: OIG concluded that this arrangement poses more than a minimal risk of fraud and abuse under the AKS because the CE programs would be sponsored by industry sponsors, relieving the Requestor of paying any expenses that the Requestor would otherwise incur. OIG has concerns regarding the provision of free goods or services to an existing or potential referral source. The provision of goods or services that have independent value to the recipient or for which the recipient would otherwise pay confers a benefit on the recipient. Thus, the OIG was unable to conclude that the industry sponsorships in Proposed Arrangement D would pose a sufficiently low risk of fraud and abuse such that it would not potentially seek to impose administrative sanctions.

As is typical, OIG stated that Advisory Opinion No. 22-14 is limited in scope to the Proposed Arrangement. However, this opinion provides guidance as to how OIG might respond to similar requests. The OIG Advisory Opinion is available here.