On January 10, 2025, OIG posted a favorable advisory opinion approving a proposed program (Program) to provide patients who meet certain financial need criteria with free access to a pharmaceutical product that has limited coverage by Federal health care programs.
Background
Under the Program, the requestor (Requestor) would provide certain patients who meet specified financial need eligibility criteria with free access to a product intended to treat an undisclosed disease and is intended for initiation in patients with mild cognitive impairment or mild disease-related dementia and confirmed presence of amyloid pathology.
When covered by Medicare, the product is covered as a Part B outpatient infusion therapy, and reimbursement is made for both the product and its administration, where the standard 20 percent coinsurance applies for Part B fee-for-service enrollees once they meet their deductible. All state Medicaid programs also cover the product, with cost-sharing requirements varying by state.
Patients would receive the product via intravenous infusions once every other week for approximately one hour in an outpatient setting. The Requestor certified that that there are no known barriers to switch or discontinue the product if a patient desired to do so. To receive the product for free, patients must meet the following eligibility criteria:
- Reside in the United States;
- Be at least 18 years old;
- Be prescribed the product for an on-label indication;
- Be uninsured, insured but with no insurance coverage for the product, or have Medicare coverage for the product but attest they are unable to afford their out-of-pocket costs associated with the product; and
- Have a household income equal to or below 500 percent of the Federal Poverty Level.
The Requestor certified that eligibility determinations for the Program are made without regard to a patient’s insurer or insurance plan, physician, or infusion provider and are not contingent on past, present, or future purchases of the product. Additionally, the Requestor certified that patients who are part of the Program are free to change physicians or infusion providers at any time. The Requestor also certified that the providers—i.e., the treating physician or the site where the product will be administered—do not purchase or get reimbursed for the free product.
OIG’s Determination
OIG concluded that the Program implicates the AKS because receiving the free product constitutes remuneration that might induce patients, including Federal health care program enrollees, to continue using the product after it becomes reimbursable by the applicable insurer, including Federal health care programs. OIG also stated that the AKS is implicated as to administering providers because they have an opportunity to receive remuneration via administration fees they earn when such fees are billable to a Federal health care program. OIG concluded that while no AKS safe harbor applies to the Program, it would not impose sanctions for the following few reasons.
First, OIG reasoned that the Program is unlikely to inappropriately increase costs to Federal health care programs because no product provided under the Program would be billed to Federal health care programs and that the only cost that could be billed is the administration fee for the infusion, which is only billed if a patient cannot afford cost sharing associated with the product. OIG recognized the risk that the Program might function as a seeding program if a patient’s insurer begins to cover the product; however, OIG believed this risk to be low since the Requestor certified that there is no barrier to patients to switch products.
Second, OIG concluded that the Program would be unlikely to interfere with clinical decision-making because treating physicians do not have a financial incentive to order the product when patients qualify for the Program since treating physicians must certify that they will not submit a request for payment for the product and will not seek payment from the patient. Additionally, OIG reasoned that the Program poses low risk of fraud and abuse because administering providers lose potential profits when patients receive the product through the Program. While the administering provider can charge the administration fee for Medicare patients who cannot afford the cost-sharing amount for the product, OIG concluded that the risk is “low that this fee would induce a treating physician to select the [p]roduct over a competing product (particularly where the existing competing products are also infused drugs with a billable administration fee).”
Third, OIG reasoned that the Program posed a low risk of steering patients to any particular provider or plan because the Requestor certified that eligibility determinations for the Program are a reasonable, uniform, and consistent assessment of financial need without regard to the providers or plans selected by the patient. Moreover, patients are allowed to switch providers at any time throughout the Program.
In addition, OIG concluded that the Program would not implicate the Beneficiary Inducements CMP because it is not likely to influence any Federal health care program enrollee’s selection of a particular provider, practitioner, or supplier since the product will be available without regard to a patient’s selection of provider.
OIG’s Advisory Opinion 25-01 is available here.
