OIG Proposes New Exception for Dialysis-Related Telehealth Technologies

On October 9, 2019, OIG published a package of proposed reforms to modernize the regulations that interpret the federal Anti-Kickback Statute ("AKS") and the federal CMP. OIG's proposal was issued in parallel to a package of reforms to the federal Stark Law issued by the Centers for Medicare & Medicaid Services ("CMS"). One item included in the package of OIG's proposed reforms is a proposed exception to CMP-prohibited remuneration for certain telehealth technologies related to in-home dialysis services.

The proposed exception would codify in regulations the statutory exception for "telehealth technologies" provided on or after January 1, 2019, by a service provider or renal dialysis facility to an individual with ESRD who is receiving home dialysis for which payment is made under Medicare Part B if certain conditions are met. Those conditions would include that the telehealth technologies: (i) are not offered as part of any advertisement or solicitation and (ii) are provided for the purpose of furnishing telehealth services to ESRD patients.

The federal statutory changes seemed to be aimed at broadening acceptable telemedicine arrangements by permitting an ESRD patient's home to be an acceptable originating site. However, the proposed exception effectively restricts the types of hardware, software, or implementing technologies that a provider can give or even loan to a patient to facilitate those telemedicine encounters.

There are several proposed aspects and interpretations of the exception on which OIG seeks comment.

Prior Clinical Relationship

As an initial matter, OIG articulated that it intends the exception to exclude arrangements whereby a provider or renal dialysis facility offers telehealth technologies to patients with whom they do not have a prior clinical relationship. This could mean that a patient must first establish the in-home dialysis care relationship before the provider or facility offers telemedicine technology to the patient to facilitate provision of those services. This may pose certain operational inefficiencies and initial inconvenience for the parties. As noted in the preamble, other exceptions may apply, including the proposed exception for patient engagement and support (section 1001.952(hh)). OIG is also requesting comments on whether it should interpret the statutory exception to extend to suppliers as well.

Substantial Contribution to Telehealth Services

OIG proposes that the exception apply only to technology that "substantially contributes" to the provision of ESRD-related telehealth services. OIG is additionally considering a requirement that the technology is furnished "predominantly for the purpose of" providing ESRD-related telehealth services or provides the beneficiary with "no more than a de minimis benefit" for any other purpose. If adopted, these requirements could serve to narrow the exception to cover essentially only those technologies that solely function to provide telehealth services and, even more specifically, those technology functions for ESRD services and limiting services benefitting comorbidities or related functions.

OIG also contemplates that this does not mean just any telehealth services, but rather only those paid for by Medicare Part B, which is a narrower set of services than those contemplated under many state definitions of "telehealth." For example, asynchronous store-and-forward services (i.e., email-type exchanges) would not be considered telehealth services for purposes of this exception. Such functionality, therefore, may have to be deactivated or blocked for any technology provided pursuant to the exception.

Only Specific Types of Technology Included

Similarly, OIG proposes to define "telehealth technologies" as including only technology that minimally permits two-way, real-time, interactive audio-visual interaction between the patient and provider. This would expressly exclude telephones, facsimile machines, and electronic mail systems (although OIG indicated that smart phones allowing secure video conferencing applications would not be considered "telephones" under this express limitation). OIG did indicate that it is considering expanding this limitation to include technologies such as software, webcams, data plans, or broadband internet access if that might positively impact beneficiary access to medically necessary care.

Not Excessive in Value

OIG is interested in ensuring that any technology provided pursuant to the proposed exception is "not of excessive value." OIG proposes to consider technology to be "of excessive value" if the retail value of the technology is substantially more than is required for the telehealth purpose. As an example, OIG explained that if a readily available $300 smartphone would adequately run the telehealth technology, the exception would not protect a donation of a $600 smartphone. OIG is further considering whether it should include other value-related limitations, such as a dollar amount cap (e.g., between $100–$500) that would be sufficient to protect the most beneficial arrangements but low enough to prevent the most abusive ones.

Not Duplicative of Technology Already Owned by Beneficiary

OIG further wants to ensure that any technology is not duplicative of technology that the beneficiary already owns. To that end, OIG is considering whether it should require providers who wish to donate technology to first make good-faith determination that the individual to whom the technology is furnished does not already have adequate technology. By way of example, OIG explained that providing a tablet to a patient would be duplicative if a digital application on a patient's existing phone would be sufficient. OIG explained its intent that such a requirement would ensure that beneficiaries are not provided valuable or duplicative technologies for improper purposes. The scope of and documentation requirements related to any such "good-faith determination" remains unclear.

Other Proposed Limitations

OIG proposed a host of other miscellaneous limitations on which it seeks comment:

• Loaner Requirement: Would require that the provider or facility retain ownership of any hardware and make reasonable efforts to retrieve the hardware once the beneficiary no longer needs it for the permitted telehealth purposes;
• Prohibition on Billing or Bad Debt Claims: Would prohibit anyone from billing federal health care programs, other payors, or patients for the telehealth technologies or related services or claiming these items as bad debt under a federal health care program.
• No Discrimination: Would require offerors of telehealth technologies to either provide the same technology to any Medicare Part B eligible patient receiving in-home dialysis, or to otherwise consistently offer the technology to all patients satisfying specified, uniform criteria.
• Written Disclosures: Would require offerors of telehealth technologies to: (i) advise patients that they retain the freedom to choose any provider or supplier of dialysis services and to receive dialysis in any appropriate setting notwithstanding the free technology; and (ii) disclose any potential hidden costs to the beneficiary associated with using the free technology.

Conclusion

Ultimately, the exception contemplated by OIG in its package of proposed reforms is already narrow as contemplated but could end up being so narrow as to preclude any functional application. Stakeholders who find value in providing such technologies to dialysis patients are encouraged to comment on OIG's proposal to highlight the operational difficulties of conforming technology offerings to such strict limitations. Although OIG's proposal of an ESRD telehealth exception generally signals support for telemedicine services, advancing such a narrow exception could have a chilling impact on the advancement of telemedicine on the whole because providers may be reluctant to provide any telehealth technology if it doesn't fit squarely into the exception. Providers should remember, however, that certain arrangements may fit into other CMP exceptions. Further, just because an arrangement does not fit squarely into an exception does not mean the arrangement necessarily violates the CMP—such arrangements can be designed with safeguards such that they still reflect low risk under the regulatory rubric.