The U.S. Department of Health and Human Services’ Office of Inspector General (OIG) recently issued Advisory Opinion 26-16, concluding that the “food-as-medicine” program operated by a federally qualified health center, which provides weekly produce boxes or vouchers paired with periodic health assessments for financially needy patients with diabetes or hypertension, presents a low risk of fraud and abuse. While the Advisory Opinion finds that the arrangement implicates both the federal Anti‑Kickback Statute (AKS) and the Beneficiary Inducements Civil Monetary Penalties (CMP) Law, OIG stated that it will not impose administrative sanctions under either authority based on the facts presented.
The program runs for six months and initially enrolls 50 existing patients who meet clinical criteria (e.g., A1C at least 7.0 within three months, or blood pressure at least 140/90 within a year), agree to nutrition and behavioral counseling, can participate in group sessions without on‑site translation, and satisfy the health center’s financial hardship standards. Participants receive either weekly $30 produce boxes delivered to their homes or $20 vouchers redeemable only for healthy foods at local grocers and farmer’s markets; a vendor administers the vouchers with controls such as receipt checks, site visits, cashier training, and memoranda of understanding with retailers that limit permissible purchases. Participants also complete initial, midpoint, and final assessments (dietitian consultations, lab tests, counseling, and physician oversight). Although the produce is free, the center bills patients or insurers for reimbursable services pursuant to its fee schedule and sliding fee policy, and funds the program through grants. The health center reports no remuneration from the third‑party lab.
OIG concluded that the arrangement would constitute prohibited remuneration under the AKS if the requisite intent were present and that the program does not fit into a safe harbor. Nonetheless, OIG declined sanctions given the program’s low fraud‑and‑abuse risk: the in‑kind benefits are narrowly tailored to disease management and consistent with the health center’s Health Resources and Services Administration (HRSA) approved services; nothing suggests that the associated reimbursable assessment services are inappropriate; the benefit is limited in value and duration; participants remain responsible for applicable cost‑sharing; and voucher safeguards mitigate misuse and undue influence on provider choice.
The arrangement also implicates the Beneficiary Inducements CMP because free produce could influence beneficiaries’ selection of the health center for items and services reimbursable by federal programs, such as nutrition services and laboratory testing. It does not qualify for the Financial Need‑Based Exception because the produce is tied to other reimbursable services provided during the required assessments. Even so, OIG exercised enforcement discretion and stated that it will not impose CMP sanctions based on the certified facts.
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