Effective Compliance for an Independent Charity Patient Assistance Program

Thomas Herrmann | November 2018
  • Patient assistance programs (PAPs) provide financial assistance to eligible individuals who incur high drug bills.
  • PAP organizations face heightened governmental review.
  • The HHS OIG has identified specific risk areas associated with PAPs.
  • A compliance program is needed to maintain a PAP’s operational integrity.
  • An independent charity PAP should develop an effective compliance program.

Independent charity patient assistance programs (PAPs) provide financial assistance to eligible underinsured patients, covering out-of-pocket costs associated with prescription medications, including co-payments, deductibles, coinsurance, and in some instances, premium and travel support. These charitable programs differ significantly from pharmaceutical company patient assistance programs that typically provide support to patients for company branded products. Independent charity PAPs operate pursuant to Advisory Opinions issued by the Office of Inspector General (OIG) in the U.S. Department of Health and Human Services (HHS). These opinions identify significant risk areas and provide direction on how an organization can operate in a legally compliant manner. In recent years there has been increased scrutiny of the relationships between pharmaceutical manufacturers and independent charity PAPs. Never has it been more important for an independent charity PAP to address key risk areas to ensure that the organization fulfills its mission in a fully compliant manner. This article describes the potential legal risks faced by independent charity PAPs, and outlines the components of an effective compliance program for such organizations.

About the Author

Thomas Herrmann advises health care clients on compliance and regulatory matters, with a focus on development and management of effective health care compliance programs. Mr. Herrmann is a recognized expert on issues related to the federal Anti-Kickback Statute, Stark Law and the False Claims Act.