Lawrence Vernaglia Comments on Recent OIG Unfavorable Advisory Opinion

Foley & Lardner LLP partner Lawrence Vernaglia is quoted in the article, “In Another Unfavorable Advisory Opinion, OIG Kos Lab Deal; Requester Again Wanted a No,” in the Report on Medicare Compliance, published by the Health Care Compliance Association.

Vernaglia, chair of Foley’s Providers of Health Care Services area of focus within the firm’s Health Care & Life Sciences Sector, discussed a recent unfavorable advisory opinion by the U.S. Department of Health and Human Services Office of Inspector General (OIG), the second in about six weeks in response to what Vernaglia said was a request which “described what a competitor plans to do in the hope of warning it off.”

Though “this is even worse than the last one,” Vernaglia explained, in terms of the “particulars of the transaction.” He said, “The requestor is a competitor unhappy with the way the competition is doing business. They could have explained bona fide reasons why this model made sense, but they didn’t.”

“There are reasonable, non-kickback reasons you might want to purchase those services and they didn’t choose to do that,” Vernaglia added. “I don’t think the industry should necessarily look at this advisory opinion and say this business model is fundamentally flawed and I don’t think OIG said so either.”