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OIG Advisory Opinion 10-17

The Office of the Inspector General (OIG) recently released Advisory Opinion 10-17 which deals with donations made as part of a private settlement agreement stemming from a Certificate of Need (CON) dispute. These donations, made to programs, which provide services to children and families, were deemed not to violate the Anti-Kickback statute.

The proposed donations would be made by the children’s health system to the health system in exchange for the health system dropping its challenge to the CON applied for by the children’s system.  These donations would be made to the health system’s wholly owned, federally tax exempt, entity that raises funds for the health system but does not provide any healthcare services.  The settlement agreement does not stipulate that either entity needs to refer patients to the other entity.

Several factors mentioned by the OIG which make this arrangement copacetic are that both requestors are non-profit, tax exempt with no incentive to grant referrals to one another, the children’s health system is obligated to pay the funds regardless of whether they are paid to the health system or some other third party, other safeguards exist to make sure that there are no incentives to grant referrals between the entities and the donations will go towards helping children and families, many of which are uninsured.

If you would like any of your financial arrangements analyzed for Stark or Anti-Kickback compliance, please visit or contact a Wachler & Associates attorney at 248-544-0888.

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