CMS to Propose Revisions to the Safe Harbors under the Anti-Kickback Statute, and to the Civil Monetary Penalty Rules Regarding Beneficiary Inducements and Gainsharing

by John W. Kaveney

It is anticipated that today the Center for Medicare and Medicaid Services (“CMS”) will publish in the Federal Register a set of proposed rules that would amend the safe harbors to the anti-kickback statute and the civil monetary penalty (“CMP”) rules under the authority of the Office of Inspector General.

The proposed rules will seek to add new safe harbors consistent with statutory provisions of the Medicare Prescription Drug, Improvement and Modernization Care Act, Pub. L. No. 111-148, and the Patient Protection and Affordable Care Act, Pub. L. No. 111-152.  In particular, CMS seeks to amend 42 C.F.R. 1001.952 to make the following changes:

  • a technical correction to the existing safe harbor for referral services;
  • protection for certain cost-sharing waivers, including: pharmacy waivers of cost-sharing for financially needy Medicare Part D beneficiaries; and waivers of cost-sharing for emergency ambulance services furnished by State- or municipality owned ambulance services;
  • protection for certain remuneration between Medicare Advantage organizations and federally qualified health centers;
  • protection for discounts by manufacturers on drugs furnished to beneficiaries under the Medicare Coverage Gap Discount Program; and
  • protection for free or discounted local transportation services that meet specified criteria.

Additionally, CMS seeks to amend the definition of “remuneration” under the CMP regulations at 42 C.F.R. 1003 by adding certain exceptions for:

  • copayment reductions for certain hospital outpatient department services;
  • certain remuneration that poses a low risk of harm and promotes access to care;
  • coupons, rebates, or other retailer reward programs that meet specified requirements;
  • certain remuneration to financially needy individuals; and
  • copayment waivers for the first fill of generic drugs.

CMS also propose to codify the gainsharing CMP set forth in section 1128A(b) of the Social Security Act.

For further information please refer to the Proposed Rule which is available here and which it is anticipated will be officially published to the Federal Register on October 3, 2014. Comments on the proposed amendments will be due within 60 days of the publication of the proposed rules.