FEDERAL HEALTHCARE FRAUD LAW - The Anti-Kickback Statute (AKS)
Federal Healthcare Fraud Laws
Federal healthcare regulation are complex so that the ordinary physician cannot invest the time to fully understand them. However, any medical practice is presumed to have a full understanding of these laws. It is expensive but often prudent to hire established third party administrators for all but the most simple of practices. If there are violations of federal laws or regulations there is always the threat of criminal fraud charges or expensive civil legal entanglements. There a criminal FCA (18 U.S.C. § 287) but that is a different discussion.
The five main federal fraud laws affecting a medical practice are:
1. False Claims Act (FCA)
2. Stark Law (Physician Self Referral Prohibition)
3. Anti-Kickback Statute (AKS)
4. Exclusion Authorities
5. Civil Monetary Penalties Law (CMPL)
There are many federal agencies that enforce these laws. The main three are:
Department of Justice (meaning the Attorney General, FBI)
Department of Health & Human Services through the Office of Inspector General (OIG)
Centers for Medicare & Medicaid Services (CMS)
The penalties for violating the federal laws include:
Prison and massive fines
Restitution to the government or other payors
Exclusion from federal health care programs
Medical Board or Medical Commission action against a medical license
Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b))
The Anti-Kickback Statute (AKS) is a criminal statute carrying potential time in federal prison. It is a crime that requires a low level of criminal intent. You need not intend to violate the law (counterfeiting is an example of a crime where there is a clear (and obvious) intent to violate the law. To violate the AKS you need only act knowingly and intentionally to do something that is prohibited.
What is prohibited under the AKS? Many things including paying (remuneration) money or providing something in exchange for getting a patient referral. It gets more complex and involves creating business for any item reimbursed from a federal healthcare program.
The word “Remuneration” is a legal catchall and it includes cash, checks, gift cards, lowered rent, free rent, vacations, meals etc.. It is often disguised as payment for services when no services are rendered. “Directorships” are hot buttons for DOJ scrutiny since many directorships are non-functional positions other than to receive payments.
AKS penalties include prison terms, fines and exclusion from participation in the Federal health care programs.