Beneficiary Inducement Law
The Beneficiary Inducement Law is a federal health care program, created in 1996 as part of HIPAA. The law makes it illegal to offer money, or services that are likely to influence a member to select a particular care provider, practitioner, or supplier. Examples include:
- Offering gifts or payments to induce members to come in for a consultation or treatment.
- Waiving copayments and deductibles
Care providers who violate this law may be fined up to $10,000 for each wrongful act. Fines may be assessed for up to three times the amount claimed. Violators may also be excluded from participating in Medicare and Medicaid programs.
Allowable Gratuities: Items or services offered to members for free must be worth less than $10 and total less than $50 per year per beneficiary. Never give cash or gift cards to members.