The Federal Anti-Kickback Statute, enacted as part of The Medicaid and Medicare Patient Protection Act of 1987, and codified at 42 U.S.C. §1320a-7b, criminalizes certain conduct affecting reimbursable services under Medicare and Medicaid, and other federally-funded programs.
Specifically, the statute prohibits the solicitation to pay, offer to pay, or receipt of payments, bribes, or rebates, in connection with the referral of individuals for medical services or goods, and all aspects of transactions involving goods, facilities, or services, for which payments may be made in whole or in part by Medicare and Medicaid or other federally-funded programs such as TRICARE.
At its core, the Anti-Kickback Statute prohibits bribes, payments or rewards (directly or indirectly) – or the solicitation or offers of such remuneration – in connection with practically every aspect of health care delivery when any portion of those goods or services are paid for with federal dollars.
Violations of the Anti-Kickback Statute can result in a felony conviction for the offenders, fines of up to $25,000, and imprisonment for up to five years.
As with the Stark Act, compliance with the provisions of the Anti-Kickback Statute is a condition of payment within Medicare and Medicaid, and other federally-funded programs. Anti-Kickback Statute violations can create liability under the False Claims Act when persons or entities submit or cause others to submit claims for payment to Medicare or Medicaid with knowledge that the underlying transactions were in violation of the Anti-Kickback Statute prohibitions.
Real World Examples of Recent Anti-Kickback Statute Violation False Claims Act Cases:
- 2011: Cardinal Health, Inc. paid $8 million to settle a whistleblower lawsuit claiming violations of the Federal Anti-Kickback Statute. One of the whistleblowers, a pharmacy owner, alleged that Cardinal Health violated the Anti-Kickback Statute by paying him $440,000 to purchase prescription drugs from Cardinal Health. The whistleblowers received $760,000 as a result of the settlement.
- 2009: Healthways, Inc. paid $40 million to resolve a whistleblower case in which it was alleged that Healthways' subsidiary paid kickbacks to more than 200 physicians for patient referrals. The whistleblower, a former employee of Healthways' subsidiary, received more than $7 million.