On October 20, 2023, a recent development unfolded within the Department of Health and Human Services’ (HHS) Office of Inspector General (OIG). It issued an unfavorable
Advisory Opinion No. 23-08 that affects a supplier of cochlear implants combined with external sound processors, henceforth referred to as the “Device”.
The Device supplier proposed to provide free hearing aids to candidates for cochlear implants in one ear and hearing aids in the other, a condition technically referred to as bimodal hearing. This proposal is part of a scheme hereinafter referred to as the “Proposed Arrangement”
The OIG found that the Proposed Arrangement could potentially infringe the Anti-Kickback Statute and Beneficiary Inducements Civil Monetary Penalties (CMP). This statute and set of sanctions is designed in part to prevent undue influence or manipulation of healthcare services, to promote fairness and integrity in the sector.
While hearing aids can significantly improve the quality of life for those with hearing impairments, cost remains a significant barrier for many. The supplier’s proposal of giving away hearing aids free of charge is evidently a well-intentioned idea with the potential to positively impact the lives of many bimodal-hearing candidates.
However, according to the OIG’s interpretation, the initiative may violate the Anti-Kickback Statute by offering free items to induce the purchase of federally reimbursed items. Furthermore, it could potentialy go afoul of the Beneficiary Inducements CMP through offering remuneration to influence the selection of a particular provider, practitioner, or supplier for federally payable items or services.
This development underscores the complex and often delicate nature of legal issues surrounding healthcare benefits and serves as a reminder for all stakeholders to exercise due diligence in crafting and evaluating such proposals.