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avoiding illegal kickbacks in healthcare contracts lawyers

June 30, 2020

Doctors and other medical practitioners often get new business opportunities in the healthcare sector. However, it doesn’t matter if it is DNA testing, ancillary services, toxicology services, or pharmaceutical referrals, all these opportunities require conformity to the existing laws and regulations.

The federal government through Congress has stepped up the war against healthcare fraud by enacting several laws. This is because of the ever-rising numbers of healthcare fraud through false claims and kick-backs.

What are kickbacks?

The Anti-Kickback Statute prohibits individuals from willfully or knowingly receiving or solicit remuneration directly or indirectly either in kind or in cash in exchange for patient referral for a service or services under the federal government programs.

Besides the prohibition against kickbacks and healthcare fraud-related cases, most states have formulated their anti-kickback laws to curb healthcare fraud and lose of money. The difference between state and federal anti-kickback laws can be viewed in two ways.

First of all, state anti-kickback laws do not include transactions related to federal government funding but only programs run by the state as well as commercial insurance companies.

Secondly, the federal government doesn’t have jurisdiction regarding state affairs, and neither does it help in implementing laws.

Allegations of healthcare fraud and anti-kickback law violations at the state level are not investigated by federal agencies such as the Federal Bureau of Investigation (FBI) or the Office of the Inspector General. They are handled by state police together with other state organs.

State Vs Federal anti-kickback laws

Although the traditional anti-kickback regulations mainly applied to individuals involved in the federal government-funded programs, most states have moved to enact anti-kickback laws intended to capture non-federal arrangements or businesses.

In other words, in a situation where an individual commits an anti-kickback related crime that doesn’t violate any federal law, then the state anti-kickback laws take charge.

For example, the State of Florida has Florida’s Patient Brokering Act (FPBA) that is designed to curb healthcare fraud and protect the right of patients. Anybody found violating the provisions of the act is likely to face almost similar penalties to those of the federal government level.

Penalties for Anti-kickback charges

Investigations relating to the violations of anti-kickback laws are usually done by the United States Attorney in collaboration with Office of the Inspector General (OIG), Federal Investigations Bureau (FBI), Department of Justice (DOJ) and the Department of Health and Human Services (HHS).

Anti-kickbacks violations are charged under 18 U.S.C. Section 1347 – a comprehensive healthcare fraud statute within feral law. The law demands that those found liable for kickback violations repay an amount equal to the value of the kickback transaction as well as damages and fines worth up to $250,000 per case.

Besides that, the anti-kickback law also has a criminal provision where those found culpable can face charges of a federal felony as well as a prison sentence.

Understanding the Anti-kickback laws

Most physicians and healthcare providers violet the anti-kickback laws unintentionally. This is because of a lack of understanding of what anti-kickback laws entail.

If you don’t understand what the act fully means, it would best to seek advice from an experienced healthcare legal expert.

Below are some of the important things to note in the anti-kickback act:

• May be offered, solicited, received or accepted
• No remuneration of any kind
• Directly or indirectly
• Willfully and knowingly
• To provide or induce a patient referral or healthcare business

Anti-kickbacks statute vs the stark law

Most people fail to distinguish between the anti-kickback statute and the Stark law. Although the two laws are similar in many ways, there are significant differences between them:

• Unlike the anti-kickback statute that involves both civil and criminal charges, Stark law only deals with civil cases
• Stark law is narrower in the sense that it is limited to specific health services catered for by Medicare. On the other hand, anti-kickback covers Medicare and all other federal-funded programs.
• For someone to be accused of violating anti-kickback law, there must be proof of an element of intent. This is different from Stark law which is strictly a liability law.
• Violation of Stark law must involve a referral relationship between an entity and a physician or doctor. On the other hand, anti-kickbacks law is applicable to all referral sources.

In a nutshell, the best way to avoid illegal kickbacks is to master how the anti-kickbacks statute and other healthcare fraud laws operate.



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