Clinical trials, when performed ethically, are powerful vehicles that may advance medical knowledge by evaluating the safety and efficacy of new ways to prevent, detect, or treat various medical conditions. These research studies can also improve patient care not only for trial participants, but also for a larger patient population. Given the significant expense and time commitment typically associated with such trials, it is unsurprising that trial sponsors look for meaningful ways to encourage sustained patient participation.
The U.S. Department of Health and Human Services, Office of Inspector General (OIG) recently issued a favorable advisory opinion (26-05) in which it approved a medical device company’s (Company) proposal to subsidize certain Federal health care program cost-sharing obligations for a clinical trial that evaluated Company’s U.S. Food & Drug Administration-approved device in a new patient population with heart failure. Company proposed to pay in full the cost-sharing obligations that eligible participating patients would owe to Medicare for reimbursable items and services furnished during the trial.
OIG found that Company’s proposal implicates the Federal Anti-kickback Statute (AKS) and the Beneficiary Inducement Civil Money Penalty (CMP) because the proposal may induce Medicare beneficiaries (or other federal health care program enrollees) to participate in the trial to receive reimbursable items or services at no cost, or to receive other billable items or services from participating providers or sites. OIG also noted that participating providers and sites get to bill Federal health care programs for trial-related items and services, as well as to receive guaranteed payment of cost-sharing obligations from eligible patients that might not be collectible in full otherwise. Despite these concerns, OIG concluded that the risk of fraud and abuse was sufficiently low enough to issue a favorable opinion because:
- the out-of-pocket cost-sharing expenses related to trial participation would be prohibitive for many Medicare beneficiaries. Instead, the subsidies promote enrollment and retention of trial participants and ensure completion of the trial, which involves multiple clinical visits over a 24-month period.
- the risk of overutilization or patient steering is low. OIG observed that utilization may increase, but such would not be “inappropriate” because of existing guardrails. Specifically, patients must satisfy certain eligibility criteria to participate in the trial; the trial contains appropriate patient protections, an appropriate methodological design, and an adequate number of patients. Company also certified that it would not advertise the existence of the cost-sharing subsidies.
- unlike problematic seeding arrangements, the subsidies here only relate to items or services furnished as part of the trial. Company’s device is intended as a one-time treatment and aside from battery replacements, trial participants are unlikely to use Company’s other products in the future.
Click here to view the complete advisory opinion.
The potential medical advancements that might be made through clinical trials is tantalizing. Providers participating in such trials and the sites that host them must take appropriate precautions to avoid running afoul of the AKS and CMP.
Should you have any questions regarding the above or how to use subsidies in clinical trials compliantly, please contact the authors, the Garfunkel Wild attorney with whom you regularly work, or contact us at [email protected].