Medicare Compliance & Reimbursement


Feds Bolster Telehealth With Free Smartphone Program

Warning: Be aware of restrictions and rules to avoid OIG censure.

If you need to connect with your patients for telehealth purposes — but they don’t have an iPhone to connect with you — fresh OIG guidance may brighten your day. Read on for the news.

Details: In Advisory Opinion 22-08 posted last month, the HHS Office of Inspector General (OIG) reviews an arrangement submitted by a federally qualified health center. The center that serves predominantly low-income individuals offers telehealth services to its patients through a telehealth application that can be downloaded on a smartphone, according to the opinion.

The scenario: During the COVID-19 public health emergency (PHE), the center used funding from a local charity and the Federal Communications Commission’s (FCC’s) COVID-19 Telehealth Program to supply 3,000 smartphones and chargers to existing patients who did not have them, in order for the patients to access telehealth services. “The smartphones Requestor loaned under the Arrangement are ‘locked,’ meaning they restrict use to making and receiving telephone calls, sending and receiving text messages, using the telehealth application used by Requestor, and viewing the respective patient’s medical records,” the opinion letter notes.

A patient can keep the smartphone as long as the center has furnished at least one service to the patient in the prior 24-month period (regardless of whether it was a telehealth service), the opinion details. And the center asked patients to return the smartphones if they are no longer receiving services.

The center plans to continue letting patients use smartphones even after the PHE ends. But funding for voice and data service ran out, so patients have to pay for that themselves.

“Requestor has instructed patients on how to apply for voice and data services funding under the FCC’s Affordable Connectivity Program,” the letter notes. And the center “encourages individuals who do not qualify for such programs to identify similar programs that may fund the voice and data services for the patient’s loaned smartphone.”

The arrangement does have problems. It “implicates the Federal Anti-Kickback Statute because Requestor permits patients to whom it has already loaned limited-use smartphones and chargers to continue using the smartphones and chargers free of charge, and this could induce those patients to receive items and services from Requestor that are reimbursable by a Federal health care program,” the OIG observes. “Likewise, the Arrangement implicates the Beneficiary Inducements [civil monetary penalty provision] because the Arrangement may be likely to influence those patients to select Requestor for the receipt of items and services that are reimbursable by Medicare or Medicaid,” the watchdog agency adds.

Caveat: The arrangement satisfies the Promotes Access to Care Exception during the PHE, the OIG says. And even if it didn’t, “we would not impose administrative sanctions under the Beneficiary Inducements CMP,” the OIG concludes. The reasons include that the arrangement is unlikely to interfere with clinical decision-making and that it’s unlikely to encourage overutilization.

However: “The Arrangement does not satisfy a safe harbor to the Federal Anti-Kickback Statute,” the OIG decides. “However, based on the combination of safeguards present in the Arrangement, we conclude that the Arrangement presents no more than a minimal risk of fraud and abuse under the Federal Anti-Kickback Statute.” One of the contributing factors for that call is that the smartphones were funded by charity and the FCC, which do not benefit from increased utilization, the OIG points out.

With telehealth much increased under the COVID PHE, providers may find some comfort in this decision OKing a healthcare provider furnishing devices for telehealth. But they should pay careful attention to the restrictions included in the original arrangement as well, experts warn.

“The key ‘ingredient’ is likely that the smart phones must be for limited use,” Washington, D.C.-based healthcare attorney Elizabeth Hogue points out. “That is, this Advisory Opinion does not permit providers to give patients smartphones that can be used for purposes other than to engage in telehealth services with the company that provided the phone,” she says.

“This conclusion makes it clear that meeting the requirements of the opinion is crucial to avoid enforcement action,” Hogue adds.

Resource: The nine-page Advisory Opinion is at https://oig.