Understanding the Federal Anti-Kickback Statute

By: Jeff Cohen

The federal Anti-Kickback Statute (AKS) is a crucial law in the healthcare industry. It criminalizes the act of paying someone to refer patients or generate business when any form of state or federal healthcare program funds—such as Medicare, Medicaid, CHAMPUS, and TriCare—are involved. Many states have their own versions of this law. While it seems straightforward, many physicians and healthcare businesses find it challenging to comply with this foundational healthcare regulation.

Case Study: A Warning from North Carolina

Consider the case of a medical practice in North Carolina. The practice routinely sent patients’ blood work to a lab—a common procedure in the medical field. However, issues arose because the practice:

  1. Billed Medicare for phlebotomy services,
  2. Received space rental payments from the lab, and
  3. Leased a chemistry analyzer from the lab and submitted false claims to Medicare.

All the financial transactions between the lab and the practice were deemed kickbacks. While none of the practice’s physicians or managers went to prison, the settlement cost the practice a staggering $625,000.

Stay Compliant and Informed

Healthcare professionals and providers must be vigilant. If you receive anything of value—be it money, tickets, or otherwise—from an entity paid for healthcare items or services, consult your healthcare regulatory lawyer without delay. Compliance with the AKS is not just about understanding the law but also about safeguarding your practice from severe financial penalties.

Healthcare Marketing: Measure Twice, Cut Once

fhlf healthcare marketing

fhlf healthcare marketingBy: Jeff Cohen

Wanna know how often we’re asked whether the laws re healthcare marketing are really enforced?  How often we hear “Everyone is doing it.”  “Surely they [regulators] understand that every healthcare business has to market its services and item,” we’re told.  And when we start to educate people re the state and federal laws that pertain to marketing healthcare items and services (INCLUDING those for which payment isn’t made by a state or federal healthcare program), their impatience and intolerance is palpable.

Take a look at the latest report from the Department of Justice guilty plea from someone who marketed the services of a genetic testing lab.  He admitted being guilty of receiving over $300K in kickback money (presumably in the form of marketing fees) and now faces (1) a $250K fine, (2) returning all the money he received, and (3) five years in prison!

Marketing any healthcare service or item is at the tip of the sword in terms of regulatory investigation and enforcement.  It’s that simple.  And so when your lawyers drag you through laws like the Anti-Kickback Statute, the Florida Patient Brokering Act, the federal health insurance fraud law, the bona fide employee exception, the personal services arrangement and management contract safe harbor and EKRA, thank them!  And expect nothing less.  If you do ANYTHING at all in the neighborhood of marketing a healthcare item or services, the first place to start is:  meet with a very experienced healthcare lawyer who is not learning on your dime.  And have them take a couple hours to educate you about the laws, the options and the risks of each one.  And once you’ve done that, ask them what more you can do to reduce your risk, for instance—Continue reading