The Anti-Kickback Statute disallows the exchange of any form of remuneration for referrals concerning services underwritten by a federal healthcare program. Remuneration under the anti-kickback statute can also include gifts, favors, and a broad range of indirect compensations. This statute, often referred to as the anti-kickback law, is designed to protect patients and federal healthcare programs from potential fraud and abuse, thereby ensuring healthcare providers’ decisions are not influenced by outside incentives.
The wide scope of this law implies that almost anyone capable of generating business for federal healthcare programs can be subjected to it. This includes physicians and non-physician providers. Comprehension of the Anti-Kickback Statute is essential for everyone involved in the healthcare business, particularly those on the business and financial side of practice or organization.
The U.S. Department of Health and Human Services Office of Inspector General outlines violation penalties as, “Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.”
On anti-kickback safe harbor laws, the Inspector General’s Office says, “Safe harbors protect certain payment and business practices that could otherwise implicate the AKS from criminal and civil prosecution. To be protected by a safe harbor, an arrangement must fit squarely in the safe harbor and satisfy all of its requirements. Some safe harbors address personal services and rental agreements, investments in ambulatory surgical centers, and payments to bona fide employees.”
Moreover, violations can also attract liability under the False Claims Act, which the Office of Inspector General says, “The civil FCA protects the Government from being overcharged or sold shoddy goods or services. It is illegal to submit claims for payment to Medicare or Medicaid that you know or should know are false or fraudulent. Filing false claims may result in fines of up to three times the programs’ loss plus $11,000 per claim filed. Under the civil FCA, each instance of an item or a service billed to Medicare or Medicaid counts as a claim, so fines can add up quickly.”
The Anti-Kickback Statute scrutinizes a plethora of activities within the healthcare industry. These include any transactions or arrangements where something of value is exchanged for referrals, or to induce the purchasing, leasing, ordering, or arranging for any good or service reimbursed by federal healthcare programs.
Examples of activities under scrutiny include but are not limited to hiring referrals, discounts on medical supplies in exchange for future business, structuring joint ventures to reward referrals, lavish gifts, trips, and excessively compensating physicians for consultations or speeches. Understanding and monitoring these activities for potential violations is a crucial aspect of running a compliant healthcare business.
Ordinary business decisions in healthcare organizations can sometimes unintentionally cross into Anti-Kickback violation territory. For instance, a practice might decide to remunerate physicians based on the volume of patient referrals they garner. While this may seem like a logical business decision, it can be interpreted as paying for referrals, which contravenes the Anti-Kickback Statute.
Joint ventures and partnerships in healthcare can bring many benefits, but they can also pose potential Anti-Kickback risks. For example, if a physician partners with a medical device company and the partnership agreement includes a clause where the physician will exclusively use the company’s products, this could be seen as remuneration for referrals.
Similarly, if a hospital enters into a joint venture with a laboratory and then directs all its lab work to the joint venture, this could be viewed as a violation of the Anti-Kickback Statute. Therefore, any joint venture or partnership agreements must be carefully evaluated to ensure they do not inadvertently create kickback situations.
Given the complexity of the Anti-Kickback Statute and the potential severity of violations, it’s advisable to seek legal counsel when making significant business decisions in healthcare. Legal counsel can help interpret the Anti-Kickback Statute, provide guidance on the application of safe harbors and exceptions, and offer advice on how to structure business arrangements to minimize risk. By involving legal counsel in these decisions, healthcare providers can better protect themselves from potential Anti-Kickback violations.
Fenton Jurkowitz Law Group has seasoned anti-kickback lawyers who can help you and your practice navigate the intricacies of this statute as well as others like the physician self-referral law, also known as the Stark Law and the False Claims Act.
While it’s not expected for a medical professional to have a strong legal background in order to practice, it’s advisable to work with those who do have a deep understanding of the laws that surround your practice so you can deliver the best care possible. For more information on how your organization can benefit from hiring an Anti-Kickback attorney, fill out our online contact form today.