Gifts to Referral Sources During the Holidays - Illinois Continuity of Care Association

private duty providers and federal anti-kickback statute

The holiday season is here! Providers may wonder what they can give referral sources. The two primary sources of information about what can be given to referral sources are: the so-called Stark laws and regulations; and the federal anti-kickback statute. Laws in some states may also address this issue, so providers should also review applicable state statutes in all the states in which they provide services.

First, the Stark laws and regulations apply only to physicians, not to other types of providers. In addition, the Stark laws and regulations apply only to providers of designated health services (DHS). Home health services are DHS, for example, but hospice services are not DHS. The Stark laws and regulations do not apply to hospices.

The Stark laws and regulations say that providers that receive referrals from physicians can give referring physicians and/or their immediate family members non-cash items of nominal value. Staff may, for example, provide lunch or snacks, such as cookies, to physicians and their personnel at their offices. Providers may also routinely give items of limited value; such as coffee mugs, pens, and notepads; to physicians and their staff members. Gift cards and gift certificates are often considered to be cash equivalents by enforcers and should not be given to referral sources.

Non-cash holiday gifts of nominal value will not violate the Stark statutes and regulations if the following criteria are met:

The annual aggregate value of non-monetary gifts to a physician does not exceed $452.00 for 2022. This amount varies annually depending on the consumer price index (CPI). The Centers for Medicare and Medicaid Services (CMS) has not yet published the annual aggregate value permitted for 2023.
Providers that give non-monetary compensation to physicians make it available to all similarly situated physicians, regardless of whether physicians refer patients to the company for services.
Compensation is not determined in any way that takes into account the volume or value of a physician’s referrals to providers.

Providers who render DHS can, therefore, give physicians holiday gifts so long as the above criteria are met.

Providers must bear in mind, however, that the federal statute that prohibits illegal remuneration or kickbacks is also applicable to giving holiday gifts to referral sources. This federal statute generally prohibits anyone from offering to give or actually giving anything to referral sources in order to induce them to make referrals.

Unlike the Stark laws and regulations, however, the anti-kickback statute applies to all providers. Also, unlike the Stark laws and regulations, the anti-kickback statute and regulations do not include a specific dollar amount of non-monetary compensation that is allowable. Compliance with the dollar limitations of the Stark statutes and regulations, however, may provide protection to providers with regard to non-monetary compensation provided to all referral sources even though the Stark limits technically apply only to physicians. In addition, gift cards and gift certificates are often considered to be cash equivalents by enforcers and should not be given to referral sources in order to comply with the anti-kickback statute.

The OIG has been quite clear that providers must carefully document every item given to referral sources.

Happy Holidays!