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Advisory Opinion 01-20

Concerning a payment arrangement between a Medicare-certified hospice and certain nursing facilities for services provided to residents of such facilities who are eligible both for Medicaid and Medicare hospice benefits ("Dually Eligibles"). Specifically, for Dually Eligibles, the hospice pays the nursing facilities the full Medicaid nursing facility per diem rate for non-hospice patients, which covers pharmacy services, plus a separate payment for drugs used by Dually Eligibles in connection with their terminal illness. You have asked whether such an arrangement would constitute grounds for the imposition of sanctions under the exclusion authority at section 1128(b)(7) of the Social Security Act (the "Act") or the civil monetary penalty provision at section 1128A(a)(7) of the Act, as those sections relate to the commission of acts described in section 1128B(b) of the Act.

Advisory Opinion 01-20