By Faris L. Flournoy III, CEO, Flournoy Health Systems, Inc.
In home care, trust is everything, especially for families navigating Medicaid home care and long-term caregiving decisions.
Families do not just choose an agency based on services or availability. They invite caregivers into their home, allow them to care for their loved one, assist with bathing, meals, medications, and daily needs, and in many cases, become part of their support system.
That is why the recent OIG Advisory Opinion No. 25-12, issued December 30, 2025, and posted January 5, 2026, is one of the most important federal decisions the home care industry has seen in years.
This decision sends a clear message.
Medicaid services cannot be treated like a business hustle. Medicaid dollars are not a marketing tool. Families should never be steered toward a home care provider through unethical recruiting practices.
What Is OIG Advisory Opinion 25-12?
In this opinion, the Office of Inspector General reviewed a proposed arrangement where a home care agency planned to advertise and offer sign-on bonuses to prospective employees.
At first glance, a sign-on bonus might sound harmless. Many industries offer bonuses to recruit employees. But this situation was different. The agency openly admitted that the bonus was meant to attract caregivers who were often family members of the Medicaid recipient. Those caregivers would likely be the decision-makers selecting the agency for services. In other words, the caregiver was not just an employee. They were also the person choosing the provider.
That is where the OIG drew the line.
The OIG concluded that this proposed arrangement could violate:
- The Federal Anti-Kickback Statute
- The Beneficiary Inducements Civil Monetary Penalty
- And could result in sanctions and exclusion from federal programs
This was not a minor warning. It was a firm statement that paying bonuses in this way could be viewed as illegal remuneration meant to influence Medicaid-funded decisions.
Why the OIG Decision Matters for Families Using Medicaid Home Care
Let us put this in plain language.
If an agency offers someone money upfront to sign on, and that person is also choosing the agency for their loved one’s Medicaid services, that bonus can function like a bribe.
The OIG explained that these bonuses create a serious risk of steering. That means families could be pushed toward a provider not because of quality, but because of cash incentives.
That is not what Medicaid is for. Medicaid dollars are meant to support the most vulnerable among us. That includes seniors, disabled individuals, medically fragile children, and families who depend on long-term care services to survive. When agencies begin competing by offering bigger and bigger bonuses to buy business, the entire system becomes corrupted.
The OIG even warned that agencies may start diverting resources away from care just to afford these incentives. That means fewer resources for:
- training
- 24-hour back-up staffing
- nursing supervision
- quality control
- caregiver development
- client support services
The result is dangerous. Families may unknowingly sign up with an agency that is built on marketing tricks rather than real service delivery.
A Major Clarification: Family Caregivers Can Be Paid, but Not by Agency Rules
Flournoy Health Systems, Inc. wants the public to clearly understand something that is being confused and misrepresented in the marketplace. Yes, a family member can be compensated to care for their loved one. That is legal. That is appropriate. That is often one of the best solutions for families who want to keep their loved ones safe at home.
However, family caregivers are not paid because an agency approves them. They are paid only if they meet the qualifications and eligibility requirements established by the State Medicaid program, not by the home care agency. That distinction matters.
The State determines:
- who qualifies
- what documentation is required
- what training must be completed
- what services are approved
- and when services can begin
All Medicaid providers must follow those rules exactly.
We are part of the process, but we are not the whole process. We operate in partnership with Medicaid, but we do not control Medicaid eligibility decisions, waiver approvals, or timelines.
We also cannot promise families that the process will move quickly, because no agency controls the speed of the State’s Medicaid approval system.
What we can promise is far more important. We will always communicate honestly. We will always follow the law. We will always operate ethically.
Risks of Non-Compliant Home Care Agencies: Bad Actors Will Always Pop Up
Unfortunately, in healthcare, every time there is funding, there will be companies that appear overnight with one goal: to get Medicaid money fast.
They often advertise in ways that focus heavily on incentives and speed, rather than compliance and long-term care quality, which can result in families being misinformed about what is legally allowed.
When the government catches up, it is not just the agency that suffers. It is the families, the caregivers, and the vulnerable clients who are left in chaos. Many are forced to transition care unexpectedly. That is why this OIG opinion matters so much. It is a warning not only to providers but also to the public.
FHS Believes in Doing It the Right Way: Our Commitment to Ethical, Medicaid-Compliant Home Care Services
At Flournoy Health Systems, we welcome this opinion.
We believe in transparency. We believe in ethical leadership. We believe healthcare providers should be held to the highest standard, because we are serving human beings, not accounts.
One company under our umbrella, Primecare Home Care Services, has proudly served communities since 2007 and, as the flagship organization, has supported tens of thousands of clients over the years.
Primecare Home Care Services was not built by cutting corners. Primecare was built by showing integrity, investing in caregivers, supporting families, and operating within the rules set forth by the States we serve, and the federal laws that govern Medicare and Medicaid.
This is what real healthcare looks like.
How Can Families Choose an Ethical Home Care Provider?
This OIG opinion should make every family stop and ask: Why is this company offering money just to get someone to sign up?
A quality home care agency should be able to recruit and retain caregivers because of:
- strong training programs
- proper supervision
- stable pay structures
- leadership accountability
- consistent support systems
- compliance and ethics
Not because they are dangling cash to win business.
The OIG made it clear that these sign-on bonus arrangements, in situations where the employee is essentially bringing their own Medicaid client, are not simply recruiting. They can become illegal inducements.
Why OIG Advisory Opinion 25-12 Sets a Precedent for Medicaid Home Care
This is not just about one agency. This is about the entire future of Medicaid home care.
OIG Advisory Opinion 25-12 sets a precedent that providers must be extremely cautious about how they market themselves, especially when recruiting family caregivers tied directly to Medicaid-funded services. It sends a message to every agency. If your marketing strategy depends on incentives that influence who gets chosen for Medicaid services, you are playing with fire.
Our Commitment Moving Forward
At Flournoy Health Systems, Inc., we will continue to operate with honesty and compliance.
We will continue to educate our communities.
We will continue to support our caregivers with real resources, not misleading gimmicks.
We will never mislead families with false guarantees.
We will never promise timelines we do not control.
We will never attempt to buy referrals or manipulate a family’s decision through improper incentives.
We will only market our services ethically , and we will follow every rule and regulation established by the State Medicaid programs in the states where we operate, because Medicaid is not a business opportunity. It is a lifeline, and lifelines should never be exploited.
Source:https://oig.hhs.gov/documents/advisory-opinions/11440/AO-25-12.pdf
