Continuing Education Events May Be Seen as Inducements For Patient Referrals

Healthcare leaders understand the importance of compliant transactions with physicians and seek to avoid any violation of the Anti-Kickback Statute (AKS). But it can get tricky when the compensation is not monetary, so the Office of Inspector General (OIG) weighed in on a recent request for clarification.


According to an advisory opinion (AO No. 22-14) dated June 29, 2022, an ophthalmology practice (Requestor) specializing in cataract and refractive surgery sought guidance on how best to offer continuing education (CE) programs to all local optometrists. In these CE programs, attendees would learn about new technology and pharmacological practice treatment protocols related to treating patients who require ophthalmic surgeries. According to information provided in the AO, the programs offered by the Requestor would meet state requirements for CE certification for optometrists and count toward the attendees’ required CE hours.




A cause for concern in this situation relates to the potential referral relationship between the Requestor and optometrists attending the proposed CE programs. According to the Advisory Opinion, approximately half of the Requestor’s surgical procedures were referred by local optometrists. Since it is a criminal offense to pay for or receive remuneration for referrals of services reimbursable under a Federal health care program, the Requestor wanted to ensure that its provision of CE would not be construed as remuneration for any of the attendees’ referrals.


For purposes of the Federal anti-kickback statute, “remuneration” includes the transfer of anything of value, directly or indirectly, overtly or covertly, in cash or in kind. CE requirements vary by state, but optometrists are generally required to complete about 30 hours of CE every 2 years to maintain their license. Our research shows that online CE courses usually run about $30 per hour, with in-person classes costing a good bit more, so there is real tangible value to these programs and providing them for free to possible referral sources poses risk of fraud and abuse.


To find out how it could offer CE to local optometrists without running afoul of Anti-Kickback and other laws, the Requestor submitted 4 proposed program-funding scenarios for OIG consideration.


Scenario One

In the first scenario, CE attendees would be required to pay a fair market value (“FMV”) “entry” fee. The Requestor would cover any outstanding balance if the payments did not cover the cost of the program, and – alternatively – would donate any leftover fee amount to charity.


The OIG determined that Scenario One is a low-level risk arrangement. While the attendees are receiving (non-monetary) benefits from the practice in the form of CE, and some participating providers may likely refer patients to Requestor, the program is open to anyone, regardless of downstream referral potential – and there is a fair market value fee to attend.


Scenario Two

Under the second scenario, the Requestor would cover all costs for the CE program, allowing free admission to participating attendees.


This framework was seen by OIG as posing more than a minimal risk of being perceived as an inducement for attendees to refer patients to the requesting practice.


The final 2 scenarios share a common feature: medical device manufacturers and/or pharmaceutical companies would sponsor —that is, fund — the CE programs. The OIG acknowledged that while industry sponsors are common for CE events or programs, the event organizer is typically a professional association, i.e., an organization that doesn’t provide patient care and therefore could not possibly reap any benefit from patient referrals. In these cases, both the event organizer (Requestor) and the attendees could potentially serve as direct referral sources for industry sponsors.


Scenario Three

In the case of the third scenario, no fee would be charged to attendees and the industry sponsor(s) would help finance the program hosted by the Requestor. The kickback concern here then is two-fold – not only could the attendees be induced to provide referrals to the Requestor in return for the benefit of the free CE, but the Requestor, any external presenters, and the attendees could be induced to order or prescribe the industry sponsors' products.


The OIG’s stance on Scenario Three was that there is more than a minimal risk of fraud and/or abuse.


Scenario Four

In the fourth scenario, the attendees would pay a registration fee and the event would also be funded by industry sponsors (pharmaceutical and medical device manufacturers). While this scenario may somewhat negate the potential risk for kickbacks between attendees and sponsors (due to the FMV registration fee), the potential risk of kickbacks for the Requestor and any external presenters still exists.


Therefore, Scenario Four also poses more than minimal risk of fraud and abuse, in the OIG’s view.


The value of continuing education events is inherent in the presentations, course materials, training supplies, free samples, meals, marketing tokens, and the credits awarded to attendees. Providing something of value for free to referral sources opens the door to kickback allegations, so offering free CE to referral sources or covering the hosting expenses of an event or CE program on behalf of a possible referral source creates a risky relationship. Only the Requestor’s first scenario was seen by OIG to pose a low-level risk of fraud and abuse in that it offered nothing of value for free to the practice, attendees, or potential sponsors.