CHA News Article

OIG Issues Policy on Discounts, Waivers for Self-Administered Drugs

The Department of Health and Human Services Office of Inspector General (OIG) has issued the attached policy statement to clarify the circumstances in which hospitals will not be subject to administrative sanctions for discounting or waiving amounts Medicare beneficiaries may owe for self-administered drugs (SADs). The policy is specific to SADs received in outpatient settings when the drugs are not covered by Medicare Part B. The conditions under which hospitals will not be subject to OIG administrative sanctions for discounting or waiving beneficiary costs for non-covered SADs are:

  • Hospitals must uniformly apply their policies for discounts or waivers on non-covered SADs (e.g., without regard to a beneficiary’s diagnosis or type of treatment);
  • Hospitals must not market or advertise the discounts or waivers; and
  • Hospitals must not claim the discounted or waived amounts as bad debt or otherwise shift the burden of these costs to the Medicare or Medicaid programs, other payers or individuals.

The policy statement applies only to discounts on, or waivers of, amounts Medicare beneficiaries owe for non-covered SADs that the beneficiaries receive for ingestion or administration in outpatient settings. OIG also clarifies that the policy statement does not require hospitals to discount or waive the cost of non-covered SADs, nor does it affect hospitals’ ability to discount or waive any amounts owed by Medicare beneficiaries on the basis of a good-faith, individualized determination of a beneficiary’s financial need.