HHS-OIG Issues Favorable Advisory Opinion for Free Multi-Cancer Detection Supplemental Reports Provided with Medicare-Covered Colorectal Cancer Screening Tests

The HHS-OIG recently released Advisory Opinion 26-11, a favorable opinion regarding the AKS as applied to a cancer testing company offering a free supplemental report identifying potential risks for cancers that have limited or no current screening options.

Background: Free Multi-Cancer Detection Reports Offered with Medicare-Covered Colorectal Cancer Screening Tests

The proposed arrangement involves a cancer testing company (the “testing company”) offering patients who undergo a blood-based colorectal cancer (“CRC”) screening test, with a free supplemental report identifying potential risks for multiple additional cancers using the same blood sample. The testing company would provide the free supplemental report identifying potential risks for multiple additional cancers using the same blood sample collected for the CRC screening test that is reimbursed by Medicare. The supplemental report is generated through an investigational multi-cancer detection technology that is still under development and not yet separately approved or reimbursed by Medicare.

Under the proposed arrangement, patients of the testing company who are receiving the CRC screening test could elect to receive the free supplemental report if: (1) the patient had a valid order for the CRC screening test from an independent physician; (2) the ordering physician opted in to receive the additional results; and (3) the patient consented to participate in a follow-up data collection initiative. The supplemental report identifies potential risks for several cancer types, including cancers for which there are currently limited or no broadly recommended screening options.

As part of the data collection initiative, patients authorize the testing company to collect certain follow-up medical information over time to help evaluate the clinical usefulness of the multi-cancer detection technology and support future FDA approval and insurance coverage efforts.

Why HHS-OIG Approved the Free Multi-Cancer Detection Testing Arrangement Under the Anti-Kickback Statute

HHS-OIG found that the proposed arrangement would generate prohibited remuneration under the AKS if the requisite intent were present. HHS-OIG noted that the free supplemental report could potentially influence patients to select the testing company’s CRC screening test and laboratory over competing screening options and laboratories. HHS-OIG also recognized that physicians ordering the CRC screening test could potentially benefit from follow-up visits or additional care resulting from findings in the supplemental report.

With respect to the Civil Monetary Penalty (CMP), HHS-OIG concluded that the proposed arrangement involved remuneration because the supplemental report would be provided free of charge. HHS-OIG also concluded that the CMP's Preventive Care Exception did not apply because neither the CRC screening test nor the multi-cancer detection test is currently included in the United States Preventive Services Task Force Guide to Clinical Preventive Services. However, HHS-OIG stated it would not impose sanctions for the proposed arrangement.

HHS-OIG relied on several key factors in issuing its favorable opinion, including:

• The supplemental report was available only to patients already eligible for the Medicare-reimbursed CRC screening test and who had a valid order from an independent physician.
• The investigational multi-cancer detection analysis was performed using the same blood sample already collected for the CRC screening test, meaning no additional blood draw or procedure was required.
• The supplemental report and investigational analysis did not create additional costs to Medicare because the multi-cancer detection test was not separately reimbursed.
• Any follow-up appointments or referrals resulting from positive test findings would be based on legitimate clinical information contained in the test results.
• The supplemental report could provide important clinical information for several cancer types that currently do not have broadly recommended screening options.
• Physicians would not be compensated for ordering the CRC screening test or opting in to receive the supplemental report.
• The testing company would not engage in targeted marketing, direct-to-consumer advertising, or promotional campaigns for the supplemental report, and any educational materials regarding the supplemental report would be presented in a neutral and objective manner.
• The testing company’s laboratory was already the only laboratory performing the CRC screening test, reducing concerns regarding unfair competition or inappropriate steering.

Healthcare Compliance Implications of HHS-OIG Advisory Opinion 26-11 for Laboratories and Diagnostic Testing Companies

The favorable advisory opinion highlights that HHS-OIG continues to closely scrutinize free items or services offered in connection with federally reimbursable healthcare services, particularly where those offerings could influence patient or provider choice. At the same time, the opinion shows that HHS-OIG may view arrangements more favorably where there is limited risk of overutilization, no additional costs to federal healthcare programs, no compensation tied to referrals, and the arrangement may provide meaningful clinical benefits to patients.