In advisory opinion (15-03) earlier this month, the U.S. Department of Health and Human Services (HHS) Office of the Inspector General (OIG) found that a Medigap insurer’s arrangement allowing discounts on deductibles at certain preferred hospitals  – with a portion of the resulting savings going to the insurer’s policyholders  – would not result in penalties under the Anti-Kickback Statute (AKS) or Civil Monetary Penalties (CMP) Law prohibition on inducements to beneficiaries, because the likelihood of fraud and abuse under the proposal is minimal. The requestor was an offeror of Medigap insurance, a supplemental insurance policy sold by private companies to pay some costs that Medicare does not cover. For its Medigap plans, the insurer proposed an arrangement with certain network hospitals through a preferred provider organization (PPO) where the PPO hospitals would provide discounts of up to 100 percent of the Part A inpatient deductibles, for which the...

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