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defending anti kickback charges dol pharmacy investigations lawyers

July 2, 2020

The healthcare industry is one of the most difficult to navigate for individuals looking to take part in federally-operated programs, such as Medicare, Medicaid, and Tricare. These government-backed health insurance programs have a large number of rules and regulations detailing the instances when an organization or individual can be prosecuted for indirect or direct kickbacks made to another member of the medical profession. The anti-kickback rules in the healthcare industry can lead to a decision by a federal court to impose the minimum sentence that includes up to five years in jail and fines of up to $25,000.

What are the Kickbacks in the Healthcare System?

The healthcare industry has been at the heart of the fraud that has taken place in the healthcare industry for several years with some estimates detailing as much as $60 billion is lost annually in the U.S. When thinking about fraud, most of us look at the development of identity theft and the use of illegal products as the reason for the high level of waste taking place as fraud across the nation. However, kickbacks are an often unconsidered issue within the healthcare industry.

In essence, a kickback is made when a physician agrees to prescribe a drug to a patient even though they know it will not have a positive effect on their medical condition. This is often done because a pharmaceutical company has agreed to pay the physician for each dose of the medication supplied. Another way kickbacks can be used is through the use of referrals to a medical facility from which the prescribing physician will financially benefit.

Anti-Kickback Laws

Two anti-kickback laws are used in the U.S., which are:

  • The Stark Law
  • The Anti-Kickback Statute

The Stark Law is the nickname for the Physician Self-Referral Law that covers the use of referrals under the Medicaid and Medicare programs. This law covers those physicians who are looking to financially benefit from referrals made to facilities owned by themselves or a family member. The Anti-Kickback Statute forbids any physician from financially benefitting from prescribing medication or referring a patient for treatment when remuneration is available for the physician.

Department of Labor Prosecutions

Over the last five years, the Department of Labor has been moving forward with an increasing number of prosecutions based on investigations into kickback schemes. Any defense into kickbacks will focus on the work completed by the Deprtament of Labor and federal investigators. One of the reasons why so many members of the healthcare industry are worried about the onset of an investigation by the Department of Labor is the sheer weight of the force of the federal government that will be brought down upon them. The U.S. Postal Service Investigative Service, FBI, and the local offices of the U.S. Attorney General and local investigating services.

Along with the use of traditional kickback schemes as detailed above, there are several other areas that can cause problems for a pharmacy or physician includes the use of marketers. Even when a medical professional has the correct intentions they can find themselves struggling to prove they were not trying to take part in a kickback scheme that would see them prosecuted for their role. One of the biggest mistakes leading to a prosecution identified by defense lawyers is the use of the wrong tax status for any marketing professional that is not allowed under the Anti-Kickback Statute.

Penalties for Kickbacks

Kickback penalties are some of the most stringent with the federal authorities often refusing to take into account any form of a mistake on the part of the medical professional. Financial penalties can be harsh with the federal government seeking fines of up to $50,000 per kickback violation and prison time of up to five years depending on the crimes committed.

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