On June 6, 2025, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued a favorable advisory opinion concerning a proposed telehealth staffing and services arrangement involving a management services organization (requestor MSO), a physician-owned practice (requestor PC) and third-party telehealth platforms. The proposed arrangement involved a situation in which the platforms would not have access to all commercial insurers, therefore the parties would bill the platforms’ patients through the requestor PC’s commercial contracts. The OIG concluded that the proposed arrangement would not generate prohibited remuneration under the federal anti-kickback statute (AKS), and the OIG would not impose administrative sanctions, as the proposed arrangement could meet the personal services and management contracts safe harbor.
The proposed arrangement is one of many ways national parties have sought to innovate with entity structures and relationships to expand telehealth offerings. When new providers seek to offer telehealth services, they can struggle to add commercial insurer plans. Third parties have offered to assist by managing those providers and offering commercial contracting relationships. The OIG’s advisory opinion suggests that such novel relationships can still meet a safe harbor for the AKS and provides an avenue for two or more MSOs to work together in offering telehealth or other healthcare services while still meeting a safe harbor.
Involved Parties
The requestor MSO operates in the telehealth market and provides certain nonclinical management services to the requestor PC.
The requestor PC is a physician-owned medical practice that maintains a sizable number of payor contracts with commercial health plans, including those administering Medicare Advantage and Medicaid managed care plans. The requestor PC maintains a relationship with the requestor MSO through an arrangement outside of the advisory opinion with a separate managed service organization that will continue to supply the requestor PC with nonclinical services in the proposed arrangement. None of the requestor PC’s clinical staff would be involved in the proposed arrangement.
The platforms are independent third parties that provide management services to telehealth clinical providers (platform PCs). The opinion noted that such platform PCs have limited payor contracts, particularly in underserved and rural communities, creating access challenges. Their clinical staff would be involved in the proposed arrangement.
Proposed Arrangement
Under the proposed arrangement, the requestor MSO and requestor PC would enter into agreements with the platforms and platform PCs (collectively, platform entities) through which: (i) the platform PCs would lease providers to requestor PC, and the leased providers would provide telehealth services to platform patients who are covered by insurance plans with which requestor PC maintains a contract; and (ii) the platforms would provide administrative services to requestor PC.
The requestor PC would give the platform entities access to 400 payor contracts and significantly expand the patients that these platform PCs could serve. This arrangement would help platform PCs serve underserved areas. Allowing platform PCs as a telehealth platform to enter an arrangement with requestor MSO could significantly increase patients’ access to care.
The requestor PC would bill payors directly for the telehealth services provided by the leased providers, who would be working under their contract and supervision. Requestor PC would then pay the platform PC an hourly lease fee for the platform PC’s clinical staff at a rate that would depend on the licensure type of healthcare professional. The requestors indicated that requestor PC would pay the lease fee regardless of whether the requestor PC is reimbursed by payors for the telehealth services. Additionally, the requestor PC would pay a service fee for the nonclinical administrative services it receives from the platform. The requestors indicated that the service fee would be set in advance at fair market value, and not be based on referrals or federal program business. These services would be in addition to the nonclinical services that requestor MSO already provides to the requestor PC.
OIG’s Opinion
The proposed arrangement would normally implicate the federal antikickback statute because it includes potential referrals for services reimbursable by federal healthcare programs. The hours utilized in the lease arrangement also could vary based on the number of referrals made under the relationship. However, the OIG issued a favorable opinion because it concluded that the proposed arrangement’s structure satisfied each of the elements of the personal services and management contracts safe harbor.
In reaching that determination, the OIG highlighted that the parties would have a written contract that (i) had a term of at least one year; (ii) specified all of the contemplated services; (iii) included a compensation methodology set in advance, consistent with fair market value and that does not take into account the volume or value of referrals or generated business under the federal healthcare programs; (iv) would not promote illegal conduct; and (iv) does not include services in excess of what is commercially reasonable and necessary. The OIG did not opine on the requestor’s existing arrangement, but that relationship did not prevent the parties from entering into a new arrangement that the OIG evaluated.
Key Takeaways
- Safe harbor compliance matters. Though the OIG’s favorable opinion cannot extend beyond the specific requestors and proposed facts, the opinion reinforces that arrangements that fit squarely within the safe harbor is permissible, even if the relationship would otherwise create prohibited remuneration.
- Seek fair market value opinions. When issuing its favorable opinion, the OIG noted that the compensation was consistent with fair market value based on an independent valuation. While the OIG noted that it cannot opine on the fair market valuation, companies that receive independent valuations are better positioned to demonstrate to regulators that its compensation methodology fulfills this required element under the safe harbor.
- Hourly rate can meet the revised personal services and management contracts safe harbor. Effective in 2021, OIG revised its safe harbor regulations to replace the requirement that aggregate compensation under an arrangement be set in advance with a new requirement that only the methodology for determining compensation must be set in advance. This advisory opinion shows how that change provides more flexibility for providers structuring potential arrangements. In the past, this arrangement would not have met the safe harbor since the number of hours would not have been determined in advance. Now, because the hourly rate stays the same, the parties may still form this telehealth relationship, even if referrals change the number of hours under the lease.
- Telehealth expansion is more viable. This opinion supports pathways for expanding access to covered telehealth services in a compliant manner.
- Complex corporate practice of medicine (CPOM) structures can still meet a safe harbor. Many states have CPOM doctrines that force providers to develop complex structures or navigate multiple state and federal doctrines. The OIG’s opinion suggests that parties may be able to obtain safe harbor protection by focusing on different elements of the complex relationships. This may give new telehealth platforms greater confidence to develop relationships that comply with state CPOM doctrines and federal AKS regulations.
For additional information on structuring arrangements for telehealth services or other related compliance concerns, contact one of the authors.