On May 15, 2026, the Office of Inspector General (“OIG”) of the U.S. Department of Health and Human Services issued Advisory Opinion No. 26-11 (the “Opinion”), a favorable opinion for a proposed arrangement that involved providing patients a free supplemental cancer screening report (the “Proposed Arrangement”). The Opinion provides guidance for healthcare companies navigating the intersection of innovative diagnostic offerings and federal fraud and abuse laws.
Link to The Proposed Arrangement The Proposed Arrangement
The Requestor is an oncology company that offers the first FDA-approved blood-based biomarker test for primary colorectal cancer (“CRC”) screening (the “CRC Screening Test”), which is covered by Medicare once every three years for eligible patients. The CRC Screening Test is performed exclusively in the Requestor’s laboratory, and no other laboratory performs the test.
In addition to the CRC Screening Test, the Requestor has developed a proprietary algorithmic analysis (the “MCD Test”) that identifies risks for multiple cancer types simultaneously including bladder, breast, esophageal, gastric, liver, lung, ovarian, pancreatic, and prostate cancers. The MCD Test identifies these risks using the same blood sample collected for the CRC Screening Test. The MCD Test received FDA Breakthrough Device designation in June 2025 but has not yet received FDA approval as a standalone diagnostic device.
Under the Proposed Arrangement, the Requestor provides consenting patients a free supplemental report expressing the MCD Test results (the “Supplemental Report”) alongside their CRC Screening Test results. To be eligible for the Supplemental Report, a patient must have a valid order for the CRC Screening Test from an independent, unaffiliated physician, the ordering physician must opt in to receiving results for cancers beyond CRC, and the patient must consent to participate in a data collection initiative.
Link to OIG’s Analysis OIG’s Analysis
In the Opinion, the OIG found that the Requestor providing patients with a free Supplemental Report would implicate the federal Anti-Kickback Statute and the Civil Monetary Penalties Law. The OIG further noted that no safe harbor under the AKS applies to the Proposed Arrangement, and the Preventive Care Exception to the Beneficiary Inducements CMP does not apply because neither the CRC Screening Test nor the MCD Test is listed in the USPSTF Guide to Clinical Preventive Services.
Despite finding that the Proposed Arrangement implicates both statutes, the OIG concluded that the risk of fraud and abuse is sufficiently low and declined to impose sanctions for the following reasons:
- Low Risk of Overutilization. The Supplemental Report is available only to patients already eligible for the CRC Screening Test with a valid physician order, and the MCD Test is not separately reimbursable. Because the MCD Test is performed on the same blood sample as the CRC Screening Test, providing the Supplemental Report does not generate any additional cost to federal healthcare programs. The OIG also recognized that the Supplemental Report provides critical health information about cancers for which there is no other recommended screening test, potentially leading to earlier detection and treatment.
- Low Risk of Skewing Clinical Decision-Making. Physicians are not compensated for ordering the CRC Screening Test or opting in to the Supplemental Report, and there is no targeted marketing campaign. As such, the OIG found that the Proposed Arrangement is unlikely to distort clinical decision-making because numerous factors inform a provider’s decision to order a CRC screening test, including patient eligibility, willingness to undergo follow-up procedures, test performance characteristics, and cost.
- Low Risk of Steering or Unfair Competition. Because the Requestor’s laboratory is the only laboratory that performs the CRC Screening Test, any patient selecting that test necessarily selects the Requestor’s laboratory regardless of the Proposed Arrangement. Additionally, for six of the cancer types detected by the MCD Test, there is no existing recommended screening test, limiting the competitive disadvantage to other laboratories. Additionally, OIG noted that benefits of the Proposed Arrangement outweighed the risks of unfair competition since alternative diagnostic options are invasive or risky to the patient.
Link to Conclusion Conclusion
The Opinion reflects the OIG’s willingness to take a favorable view of arrangements that provide patients with clinically meaningful information at no additional cost to federal healthcare programs, provided the arrangement is accompanied by appropriate safeguards against overutilization, undue influence on clinical decision-making, and unfair competition.