The beneficiary inducement civil monetary penalty law generally prohibits health care providers from providing gifts to a Medicare or Medicaid beneficiary—including any free or discounted item or service—if the provider "knows or should know" that the gift is "likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier." 42 U.S.C. §1320a-7a(a)(5).

Since 2000, the US Department of Health & Human Services, Office of Inspector General (HHS-OIG) has taken the position that gifts (other than cash or cash equivalents) having a retail value of no more than $10 per gift or $50 in the aggregate per patient per year are excepted from this prohibition. Earlier today, the agency issued a policy statement providing that, effective immediately, these caps would be increased by 50 percent, to $15 per gift and $75 in the aggregate per patient per year.

In announcing the increase, the policy statement also notes that the statutory text provides for a civil monetary penalty of $10,000 for each violation of the law. The statement neglects to mention, however, that HHS issued an interim final rule earlier this year that increased the penalty amount to $15,024 per violation. 81 Fed. Reg. 61538, 61543 (Sep. 6, 2016).