STARK LAW & AKS LAW (Anti Kickback Law)
If you mix some mild antibiotic, a little dab of dog parasite medicine (Ivermectin) and a bit of this and that, your Rosacea may clear up. You can’t get this at a drug store but I have a partner pharmacist who formulates this. We can bill for it and most of the time it gets paid. …. Is this legal ? The profit is tempting. Three dollars worth of chemicals, the cost of the tube and a few minutes labor and a $ 100 package exists. Studies do show it may work. Is it a Stark violation ? Is it an AKS (anti kickback statute) violation ? Is the science strong enough to justify the Rx ? Would you prescribe it if you had no financial interest ? Is this a Medical Board issue ? There are state laws, medical board rules and insurance contract standards that apply but most dangerous are the federal laws that protect federal payor programs. The complexity of laws and regulations often trip up an honest practitioner and our office knows the rules and protects you.
Do you feel safe because “Well I contacted the best medical lawyer in Los Angeles and he told me …..”. Well don’t be so certain that you are safe. Here are some recent press releases from the United States Department of Justice.
Fifteen Texas Doctors Agree to Pay over $ 2.8 Million to Settle Kickback Allegations
Flower Mound Hospital to Pay $18.2 Million to Settle Federal and State False Claims Act Allegations Arising from Improper Inducements to Referring Physicians
Those 15 doctors and the hospital likely had the best medical lawyers available to review their work. We take a very conservative approach to medical-business ventures. We often disagree with the legal opinions that read: “This opinion is no guarantee …”. The lawyer disclaimers are red flags because although we admit that many of these aggressive practices are lucrative and successful, the failures are devastating to the physicians involved.
The Stark Law developed by our local Congressman, Pete Stark. The Stark Law is also known as the Physician Self-Referral Act and unless you knew Pete Stark personally, that is the more descriptive name. The U.S. Code citation is 42 U.S.C. 1395 et seq..
As you read the Stark Law your head can spin. Can you make DHS Medicare referrals to a family member ? What if it is a lithotripsy machine ? Is there an exception ? What about small towns when other treatment facility options are miles away ? Who is covered by this “physician” law ? Does it cover Doctors of Osteopathy, Dentists ? What about Pharmacists ? What about Chiropractors ?
Equally dangerous is the “AKS”. This is the federal anti-kickback statute. The Anti-Kickback Statute again focuses on referrals. This includes kickbacks for product, medical device, pharmaceutical and services kickbacks. An example are the recent string of arrests when a physician gave free samples of pain relief cream to a patient and then recommended a formulated product from a pharmacy. The physician had a complex scheme of reimbursement which the doctor’s attorney thought avoided Stark statute and Anti Kickback statute problems. The federal prosecutors disagreed.
The bottom line is this. If you are a physician and you are making any money or have any relationship to other entities to which you refer – get legal advice. Bear in mind that with Stark law and other anti kickback statutes, our office is more conservative than many other practices. Many of these businesses involve grey areas of law and it is our goal to put your safety and your license first. We are not always right but we want our clients to sleep at night. An example are the urologist / catheter arrangements where the MD’s seem to be seller and distributor of the catheters but fulfillment is by a third party (which makes the bulk of the profit). These have often survived scrutiny but we use the “walk like a duck” approach and have unequivocally recommended against this grey area business arrangement.
If you are seeking a second opinion we can help. If you are being sued or criminal charged for self dealing violations (or any type), Daniel Horowitz is a certified Criminal Defense Specialist (State Bar of California Board of Legal Specialization).
Call our Medical License & Criminal Defense Lawyers at (925) 283-1863
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