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Is French Hospital violating anti-kickback laws?

May 9, 2012

By KAREN VELIE

It sounds like any other incentive for a new company – sign up and get a gift certificate. But San Luis Obispo based French Hospital’s promotion for its new Women’s Health and Imaging Center could violate federal anti-kickback laws.

French Hospital is offering the gift certificates, valued at $40 each, to the first 200 people who make an appointment for a bone density scan or a mammogram.

But federal anti-kickback statutes prohibit any person or entity from knowingly offering to pay cash or gift certificates in order to entice someone to purchase its products or services in which at least a portion of payment is covered by a federal health care program (42 USC § 1320a–7b).

A related law, the beneficiary inducement statute, prohibits offers of compensation to federal health care recipients that are likely to influence their choice of a health care services or product providers (42 USC § 1320a–7a(a)(5).

Last month, Walgreens agreed to pay a $7.3 million settlement after several whistleblowers  told federal authorities Walgreens had offered a $25 gift card to anyone who transferred a prescription to its pharmacies.

Even though Walgreens advertisements promoting the gift cards acknowledged that the offer was not valid for recipients of federal health care programs, its employees frequently ignored the stated exemptions, according to a Department of Justice press release.

French Hospital is offering its gift certificates regardless of whether they are a recipients of a federal health care program, because the gift cards are not meant to entice people to make an appointment, French Hospital spokesperson Megan Maloney said.

“It is not an enticement,” Maloney said. “It is just a thank you and to celebrate our grand opening.”

In addition to advertising its “May promotion” in the SLO City News, French also posted information about its offer on its website.

“In honor of the grand opening, and in honor of Mother’s Day, anyone who schedules an appointment during the month of May will receive a free pedicure (limit 200) from the Bladerunner Spa and Salon in San Luis Obispo,” the website says. “Pedicure certificates will be issued at time of appointment. Their name will also be entered to win an ultimate Spa Package from the Bladerunner as well.”


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I agree that this borders on illegal if not unethical. I don’t know if it was done through ignorance of the details of the law or was an attempt to skirt them. However, this is a case where a “slap on the wrist” type punishment is probably the most that is merited.


Save the outrage and heavy-handed reactions for serious wastes and abuses. Their are plenty out there if recent history is any indicator. Why Rick Scott is not serving time rather than serving as Florida’s governor is a good example.


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Up until about the 1960s Doctors use to be revered equal to angels and hospitals use to be thought of equal to a holy and sacred place.

Not any more, its all “primarily” about the business money!


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Is that also when doctor’s would prescribe two packs a day as healthy? Or when Gerber needed to sell more ham, so *poof* a hearty breakfast with bacon or sausage was also recommended?


How about, “Up until about the 1980’s, Doctors were never questioned and the patients were never curious about their own health…”


It’s always been about money, ever since… well, money! But that’s a whole separate topic.


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What’s wrong with a hospital making money?


What’s wrong with a charity hospital dispensing medical care for free?


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I think what will get them off the hook (or should) is the limit of “the first 200” – it is not a set kickback that a policy of $25 gift cards would seem to be.


I can see where it cruises along a fine line, but limiting the $40 gift certificates to the first 200 seems to not be so much a kick-back (unless you WANT to read into it that way); however, it does appear to be a nice way of celebrating a grand opening… I mean, sheesh, let them have their 1 month only, limited to 200 grand opening celebration.


We’re just conditioned to react certain ways to certain things. That’s all I’ll say.


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There should be absolutely no advertisements for any medical procedures! All medical procedures should be provided without regards for you being able to pay, or not. I wish we could all just go to a one payer system and let someone else pay the bill as we dutifully stand in line with our comrades. No one should cut in that line. Only the government can fix this situation, please support health care reform.


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That may have been a bit too subtle for some Downtown Bob.


While your criticisms of a single payer system may have merit, the refusal of yourself and like-minded people to admit to serious problems in the current system is the main reason why some of us are willing to try a single-payer system. It has faults too — including a big one with funding — but I am unconvinced that it would be worse than what now exists.


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Socialized medicine=loss of prosperity and freedom, fewer choices, longer waits, in a word, RATIONING.


Ask yourself these questions:


Why is the state of CA rationing education right now?


Why are government services shrinking, retracting, closing down?


Can government effectively run businesses?


It’s not the fault of the free market if some people don’t have the money to pay.


Nothing good ever comes out of Washington, D.C.


Socialized medicine? No thank you!


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It’s probably a violation of federal law. After all, we wouldn’t want to encourage women to have a bone density scan or mammogram, would we? Damn, we might get into the business of prevention or early treatment. That’s probably again federal law, too.


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Encouraging woman to get bone scans is a marketing ploy largely promoted by Merck to boost sales of their Fosamax drug to woman that don’t need it. Many woman get bone scans and start taking bone density drugs that don’t actually need to. Not only do these drugs cost patients and insurance companies a lot of unnecessary money, in some cases it has been shown that unnecessarily taking bone density drugs can cause other more serious bone problems.


So yes, blanket encouragement of women to have bone density scans is not a good thing. It is really something that your doctor should be advising you on, not some slick marketing effort by a drug company.


You can read more about this here:

http://www.npr.org/2009/12/21/121609815/how-a-bone-disease-grew-to-fit-the-prescription

and here:

http://www.niemanwatchdog.org/index.cfm?fuseaction=ask_this.view&askthisid=551


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Then surely this part cannot be against federal law. After all, if it’s such a scam, the federal government wouldn’t be paying for it (and if they don’t pay, the “incentive” isn’t against federal law). The federal government paying money for something completely unnecessary and potentially dangerous? Say it ain’t so!


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Don’t even trust the doctors, that is, not completely

And never be reluctant or too lazy to get a second opinion (out of this area!)

You will not regret what I just stated!


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This is just sick.


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I see that Walgreens is enticing folks with a $25 gift cert if you switch your drug trade to them. Is that a violation for those on part D medicare?


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Kind of cheapens the process. This is a medical process and should not be solicited like a bank offering a toaster for a new account. Are they that desperate for your business.


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Giving the gift certificates randomly to members of the community would be consistent with a “thank you.” Making them contingent upon signing up is an enticement. This was a very unwise decision.


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