The U.S. Office of Inspector General (OIG) issued Advisory Opinion 12-10 on August 23, 2012, finding that a radiology group's proposal to offer free insurance preauthorization services to physicians and patients would be permissible. The advisory opinion is very similar to OIG Advisory Opinions 10-04, 10-13 and 10-20. The similar repetitive OIG advisory opinions highlight that an advisory opinion may not be relied on by anyone other than the requestors of the opinion. Consequently, to assure that a provider is protected, it should seek its own advisory opinion, even when its program may be very similar to that approved in an existing advisory opinion.
Under the preauthorization services proposal, the radiology group proposed to contact insurers and provide any information required by the insurer. The service will be made available to all referral sources, regardless of the volume or value of their referrals.
As before, the OIG determined that preauthorization services have potential independent value to physicians where a referring physician's contract with an insurer specifically allocates responsibility for obtaining preauthorization to the physician. Where a referring physician's contract with an insurer allocates responsibility for obtaining preauthorization to imaging providers or patients—or does not allocate responsibility to any party, the OIG found that the imaging provider would not be relieving an express financial obligation that the physician would nonetheless be providing remuneration to the referring physician (e.g., a physician whose staff is devoting considerable time to preauthorizations might realize significant savings).
When a party in a position to benefit from referrals provides free administrative services to an existing or potential referral source, the OIG concluded that there is some risk that at least one purpose of providing the services is to influence referrals. However, the OIG again concluded that the arrangement posed a low level of risk, and issued a favorable advisory opinion.
In reaching its conclusion, the OIG cited the following factors: (1) the arrangement would not target any particular referring physicians; (2) the radiology provider was unlikely to know a physician's obligations with respect to an order for a particular patient; (3) the radiology provider has a legitimate business interest in offering uniform preauthorization services as only its payments are at risk, even though responsibility may be allocated to a referring physician; (4) the services would be available on an equal basis to all patients and physicians, without regard to any physician's overall volume or value of expected or past referrals; (5) the radiology provider would make no assurances to physicians or patients that its preauthorization service would result in preauthorization being approved; (6) the radiology provider would abide by applicable privacy laws; and (7) the arrangement would operate transparently in that the provider's representatives would identify themselves to insurers as representatives of the radiology group.
The OIG then distinguished this arrangement from prior administrative services arrangements that it has disapproved. See e.g., OIG Special Fraud Alerts: Home Health Fraud, and Fraud and Abuse in the Provision of Medical Supplies to Nursing Facilities, 60 Fed.Reg. 40847 (August 10, 1995) ("Kickbacks have taken the following forms ... Providing hospitals with discharge planners, home care coordinators, or home care liaisons in order to induce referrals." "The following factors may also indicate improper supply transactions . . . . [u]nusually active presence in nursing facilities of medical supply sales representatives who are given, or request, unlimited access to patient medical records."). In this case the radiology group would have little opportunity to influence referrals because patients already would have selected the group to provide their imaging services. In this way, the arrangement differs from arrangements where referral seekers provide referral sources with staff who have a greater ability to influence referrals, such as discharge planners, home care coordinators, or home care liaisons.