The federal Anti-Kickback Statute is a healthcare fraud and abuse statute that prohibits the exchange of remuneration for referrals for services that are payable by a federal healthcare program. Although the Stark Law and Anti-Kickback Statute may seem similar at first glance, there are several important distinctions:
The Anti-Kickback Statute applies to any federal healthcare program (including Medicare), whereas the Stark Law is limited only to Designate Health Services paid for by Medicare.
The Anti-Kickback Statute broadly applies to any referral source, whereas the Stark Law must involve a referral relationship between a physician and his or her immediately family member and an entity.
Unlike The Stark Law, the Anti-Kickback Statute requires the element of intent to prove a violation. This is because the Anti-Kickback Statute is a criminal statute that encompasses both criminal and civil enforcement.
It is imperative that Health Tech companies pay careful attention to compliance to the Anti-Kickback Statute to avoid any potential enforcement action by the federal government. If you are concerned about compliance, please contact a qualified attorney who can walk through an action plan on how best to implement compliance.
Generally, whoever knowingly and willfully offers, pays, solicits, or receives remuneration to induce referrals for items or services covered by federal healthcare program will be in violation of the Anti-Kickback Statute unless the transaction fits within a regulatory safe harbor. Remunerations is defined broadly to include anything of value, which may include money, discounted items or services, or payments for items or services that are not necessary.
Certain arrangements, involving non-monetary remuneration, in the form of electronic health records software or information technology and training services necessary and used predominantly to create, maintain, transmit, or receive electronic health records are exempt from the definition of remuneration so long as the safe harbor standards are met.
The criminal penalties include fines of up to USD $100,000 imprisonment of up to ten years. Civil penalties can be up to USD $50,000 per violation, plus three times the amount of the improper remuneration. These penalties can be imposed on both the party receiving and the party making the illegal kickback if the violation occurred with knowing and willful intent.
The Anti-Kickback Statute includes safe harbors that exempt certain referral arrangements. Each safe harbor provides an affirmative defense against an alleged violation of the Anti-Kickback Statute, and the alleged violator will be in a better position if more safe harbors are met by the referral relationship.
Similar to the Stark Laws space and equipment rental exception, the Anti-Kickback Statutes definition of remuneration does not include payments for the use of space if the safe harbors standards are met. Similarly, remuneration does not include payments made for the use of equipment if the safe harbors standards are met.
Matthew DeNoncour, Esq. is the principal attorney and owner of Magis Law Firm, a boutique law firm based in Boston, with offices in Providence, Miami, and Fort Myers, where he provides legal services to the healthcare, life science, and technology industries. You can reach Matt at magislawfirm.com, by phone at 866-277-8680 or by email at mdenoncour@magislawfirm.com. This post is not meant to be legal advice: learn more here.
