{"id":355810,"date":"2018-10-04T16:48:09","date_gmt":"2018-10-04T21:48:09","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/healthcare\/patient-rights\/health-care-fraud-and-the-anti-kickback-statute.html"},"modified":"2024-03-29T11:22:05","modified_gmt":"2024-03-29T16:22:05","slug":"health-care-fraud-and-the-anti-kickback-statute","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/healthcare\/patient-rights\/health-care-fraud-and-the-anti-kickback-statute.html","title":{"rendered":"Health Care Fraud and the Anti-Kickback Statute"},"content":{"rendered":"\n<div class=\"wp-container-core-columns-is-layout-9d6595d7 fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30\">\n    \n    <div class=\"fl-page-articles fl-section-main fl-section-main-full-width\">\n        <h1 class=\"fl-no-margin-top\">Health Care Fraud and the Anti-Kickback Statute<\/h1>\n<section class=\"fl-gutenberg-byline\">\n    <div class=\"fl-gutenberg-byline-content\">\n                    By <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/melissa-mccall-j-d\/\">Melissa McCall, J.D.<\/a> | Legally reviewed by <a\n                href=\"https:\/\/www.findlaw.com\/company\/our-team\/susan-richmond-esq\/\">Susan Mills Richmond, Esq.<\/a>\n                | Last updated\n        <time>\n                            March 29, 2024\n                    <\/time>\n    <\/div>\n\n    \n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-legally-reviewed\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Legally Reviewed\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>This article has been written and reviewed for legal accuracy, clarity, and style by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\">FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with <a href=\"https:\/\/www.findlaw.com\/company\/company-history\/editorial-policy.html\">our editorial standards<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n\n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-fast-checked\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Fact-Checked\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>The last updated date refers to the last time this article was reviewed by FindLaw or one of our <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/contributing-authors.html\">contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please <a href=\"https:\/\/lawyers.findlaw.com\/?fli=bylinelink\" target=\"_blank\" rel=\"noopener\">contact an attorney in your area<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n<\/section>\n<p>Health care fraud is a&nbsp;<a href=\"https:\/\/www.fbi.gov\/investigate\/white-collar-crime\/health-care-fraud\" target=\"_blank\" rel=\"noopener\">growing epidemic<\/a>&nbsp;in the U.S. that affects everyone. Health care fraud can lead to higher health insurance premiums and increased taxes. Federal laws such as the&nbsp;<a href=\"https:\/\/oig.hhs.gov\/compliance\/physician-education\/fraud-abuse-laws\/\" target=\"_blank\" rel=\"noopener\">Anti-Kickback Statute and the False Claims Act<\/a>&nbsp;help protect us against this type of fraud.<\/p>\r\n<p>This article overviews health care fraud and the federal Anti-Kickback Statute (AKS).<\/p>\r\n<h2>What Is a Kickback?<\/h2>\r\n<p>A &quot;kickback&quot; is a form of&nbsp;<a href=\"https:\/\/www.findlaw.com\/criminal\/criminal-charges\/bribery.html\">bribery<\/a>&nbsp;where the parties exchange something of value for a positive outcome or favorable decision. Although they may vary in form, kickback schemes are almost always unlawful and can impact various aspects of life, including health care.<\/p>\r\n<p>For instance, suppose you&#8217;re a Medicaid patient hurt in an accident. You go to your physician for medical care. Your physician gives you a referral to a specific home health agency. Unbeknownst to you, the doctor received cash and sports tickets for making the patient referral. Because this kickback concerns health care, the physician could face criminal charges from an Anti-Kickback Statute violation.<\/p>\r\n<h2>The Anti-Kickback Statute<\/h2>\r\n<p>The Anti-Kickback Law or Anti-Kickback Statute (AKS) is a federal&nbsp;<a href=\"https:\/\/codes.findlaw.com\/us\/title-42-the-public-health-and-welfare\/42-usc-sect-1320a-7b.html\" target=\"_blank\" rel=\"noopener\">criminal law<\/a>&nbsp;that forbids kickbacks in federal health care programs. This law aims to protect patients and eliminate waste, abuse, and health care fraud from federal health care programs. These programs include, but are not limited to, the following:<\/p>\r\n<ul>\r\n<li><a href=\"https:\/\/www.findlaw.com\/healthcare\/medicare-medicaid\/medicare-an-overview.html\">Medicare<\/a>&nbsp;program<\/li>\r\n<li><a href=\"https:\/\/www.medicaid.gov\/\" target=\"_blank\" rel=\"noopener\">Medicaid<\/a>&nbsp;program<\/li>\r\n<li>Children&#8217;s Health Insurance Program (CHIP)<\/li>\r\n<\/ul>\r\n<p>It is a crime under the AKS to knowingly and willfully exchange a gift or other remuneration with the intent to gain something from the exchange. For example, a health care provider accepts one of the following to generate reimbursement from a government health care program:<\/p>\r\n<ul>\r\n<li>Payment<\/li>\r\n<li>Product<\/li>\r\n<li>Services<\/li>\r\n<li>Solicitations<\/li>\r\n<\/ul>\r\n<p>The following is a non-exhaustive list of potential non-monetary things of value:<\/p>\r\n<ul>\r\n<li>Cash<\/li>\r\n<li>Unrestricted grant money<\/li>\r\n<li>Financial interests or investment interests<\/li>\r\n<li>Free medical equipment<\/li>\r\n<\/ul>\r\n<h3>Other Federal Laws Addressing Health Care Fraud<\/h3>\r\n<p>The AKS is one of six federal laws that address health care fraud and abuse. Per the Department of Health and Human Services&#8217; (HHS)&nbsp;<a href=\"https:\/\/oig.hhs.gov\/compliance\/physician-education\/fraud-abuse-laws\/\" target=\"_blank\" rel=\"noopener\">Office of Inspector General<\/a>&nbsp;(OIG), these other five laws include the following:<\/p>\r\n<ul>\r\n<li><a href=\"https:\/\/www.findlaw.com\/healthcare\/medicare-medicaid\/the-stark-law-and-doctor-referrals.html\">Physician Self-Referral Law<\/a>&nbsp;(Stark Law)<\/li>\r\n<li>False Claims Act (FCA)<\/li>\r\n<li><a href=\"https:\/\/oig.hhs.gov\/exclusions\/authorities.asp\" target=\"_blank\" rel=\"noopener\">Exclusion Authorities<\/a><\/li>\r\n<li>Civil Monetary Penalties Law (CMPL)<\/li>\r\n<li><a href=\"https:\/\/oig.hhs.gov\/documents\/special-advisory-bulletins\/886\/SABGiftsandInducements.pdf\" target=\"_blank\" rel=\"noopener\">Beneficiary Inducement Statute<\/a><\/li>\r\n<\/ul>\r\n<h2>Understanding Health Care Fraud<\/h2>\r\n<p>Health care fraud affects all of us, whether it results in any of the following or not:<\/p>\r\n<ul>\r\n<li>Higher insurance premiums<\/li>\r\n<li>Overutilization of medical services<\/li>\r\n<li>Unnecessary medical procedures<\/li>\r\n<\/ul>\r\n<p>We trust our physicians, relying on their advice and recommendations in our medical decision-making. This trust diminishes when our health care providers get kickbacks or other financial incentives in exchange for recommending treatment or medical devices. Health care fraud jeopardizes patient care and the delivery of health care services.<\/p>\r\n<p>Health care fraud is an issue across our health care system, including, but not limited to, the following:<\/p>\r\n<ul>\r\n<li>Hospital services<\/li>\r\n<li>Clinical laboratory (lab testing)<\/li>\r\n<li>Pharmaceutical companies (pharmacies and prescription drugs)<\/li>\r\n<\/ul>\r\n<p>As a patient, you have a right to receive care&nbsp;<a href=\"https:\/\/www.ncbi.nlm.nih.gov\/books\/NBK22944\/\" target=\"_blank\" rel=\"noopener\">not connected to your physician&#8217;s financial interest<\/a>. If you suspect your health care provider is engaging in health care fraud, you can submit a complaint to the HHS Office of Inspector General&#8217;s&nbsp;<a href=\"https:\/\/oig.hhs.gov\/fraud\/report-fraud\/\" target=\"_blank\" rel=\"noopener\">complaint hotline<\/a>.&nbsp;<a href=\"https:\/\/oig.hhs.gov\/fraud\/report-fraud\/\" target=\"_blank\" rel=\"noopener\">The Department of Justice<\/a>&nbsp;states that hotline tips are incredibly valuable, and this department appreciates your efforts to help stamp out fraud, waste, and abuse.<\/p>\r\n<h2>What the Anti-Kickback Statute Covers<\/h2>\r\n<p>The scope of the statue is broad; it covers both the person and the company that offers or pays the kickback and the person or company that solicits or receives it. For instance, if a hospital participated in a scheme to incentivize patient recruiters to recruit homeless patients, the hospital and the recruiters violated the AKS.<\/p>\r\n<h2>Penalties for Violations of the Anti-Kickback Statute<\/h2>\r\n<p>Unlike the&nbsp;<a href=\"https:\/\/www.findlaw.com\/healthcare\/medicare-medicaid\/the-stark-law-and-doctor-referrals.html\">Stark Law<\/a>, which deals with improper referrals, civil and criminal penalties apply to persons or entities that violate the AKS. Possible penalties for an AKS violation include the following:<\/p>\r\n<ul>\r\n<li><a href=\"https:\/\/oig.hhs.gov\/compliance\/physician-education\/fraud-abuse-laws\/#:~:text=Criminal%20penalties%20and%20administrative%20sanctions,the%20amount%20of%20the%20remuneration.\" target=\"_blank\" rel=\"noopener\">Criminal Penalties<\/a>: fines, jail terms, and exclusion from participation in the Federal health care programs<\/li>\r\n<li>Civil penalties: fines up to $50,000 per violation, extra fines up to three times the payment amount<\/li>\r\n<li>Administrative sanctions: Possible exclusion from participation in federal health care programs.<\/li>\r\n<\/ul>\r\n<h3>Safe Harbor Exemptions<\/h3>\r\n<p>&quot;Safe harbor&quot; regulations exempt specific transactions and arrangements that would otherwise be an AKA violation. If the parties qualify for the &quot;<a href=\"https:\/\/www.ecfr.gov\/cgi-bin\/retrieveECFR?gp=1&amp;SID=90f45f0c857144405b17a43c35600c16&amp;ty=HTML&amp;h=L&amp;mc=true&amp;r=SECTION&amp;n=se42.5.1001_1952\" target=\"_blank\" rel=\"noopener\">safe harbor<\/a>,&quot; they aren&#8217;t in violation. Examples of protected practices include the following, among others:<\/p>\r\n<ul>\r\n<li>Payments made for space rentals or equipment rentals<\/li>\r\n<li>Referrals made as part of an employment or professional service agreement<\/li>\r\n<li>Specific payments made for health practitioner recruitment purposes<\/li>\r\n<\/ul>\r\n<h2>Liability Under the False Claims Act<\/h2>\r\n<p>The False Claims Act (FCA) is a federal statute that bans businesses from submitting false claims to defraud the federal government. Consider, for example, a physician who prescribes an unnecessary medical device to a patient under a kickback scheme. The physician then bills Medicaid, knowing the patient doesn&#8217;t need the device. This is a false or fraudulent claim.<\/p>\r\n<p>Under the FCA, businesses that submit fraudulent claims face&nbsp;<a href=\"https:\/\/oig.hhs.gov\/compliance\/physician-education\/fraud-abuse-laws\/\" target=\"_blank\" rel=\"noopener\">severe penalties<\/a>, as set forth by the HHS OIG, including:<\/p>\r\n<ul>\r\n<li><a href=\"https:\/\/dictionary.findlaw.com\/definition\/treble-damages.html\" target=\"_blank\" rel=\"noopener\">Treble<\/a>&nbsp;damages per claim<\/li>\r\n<li>Civil penalties of up to $11,000 per claim<\/li>\r\n<\/ul>\r\n<p>The civil FCA does not require specific intent to defraud and offers special incentives to whistleblowers. A whistleblower is a person who reports fraudulent or criminal activity in their workplace. Under the FCA, whistleblowers can file a lawsuit on behalf of the United States (a&nbsp;<a href=\"https:\/\/www.findlaw.com\/employment\/whistleblowers\/qui-tam-actions.html\">qui tam<\/a>&nbsp;lawsuit) and keep a percentage of the recovery.<\/p>\r\n<p>Penalties also include criminal fines, imprisonment, or both.<\/p>\r\n<h2>Get Legal Help<\/h2>\r\n<p>Health care fraud affects our entire health care system. If a patient or physician is concerned about possible AKS violations, they should speak to a whistleblower and qui tam attorney. They are experts in navigating whistleblower lawsuits and can offer sound legal advice. Speak to an experienced&nbsp;<a href=\"https:\/\/lawyers.findlaw.com\/whistleblower-qui-tam\/?fli=dcta\" target=\"_blank\" rel=\"noopener\">whistleblower and qui tam attorney<\/a>&nbsp;today.<\/p>\r\n<div class=\"was-this-helpful\">\n    <div\n            class=\"was-this-helpful__question-container\"\n            aria-labelledby=\"was-this-helpful__question\"\n            role=\"group\"\n    >\n        <span\n                id=\"was-this-helpful__question\"\n                class=\"was-this-helpful__question fl-text-lg-bold\"\n        >Was this helpful?<\/span>\n        <button\n                class=\"was-this-helpful__button fl-text-sm\"\n                aria-label=\"Yes\"\n                value=\"yes\"\n        >\n            <span class=\"was-this-helpful__button-text fl-text-bold\">Yes<\/span>\n            <i class=\"was-this-helpful__button-icon\">\n                <svg width=\"22\" height=\"22\" viewBox=\"0 0 22 22\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\">\n    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          class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Other\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--negative-other\"\n                        >Other<\/label>\n                    <\/div>\n                <\/fieldset>\n            <\/div>\n            <div class=\"was-this-helpful__form-buttons-container\">\n                <button\n                    class=\"was-this-helpful__feedback-button was-this-helpful__feedback-button--positive at-feedback-submit fl-button secondary\"\n                    type=\"submit\"\n                >\n                    <span class=\"fl-button-content\">Submit<\/span>\n                    <i\n                        class=\"fa fa-angle-right medium\"\n                        aria-hidden=\"true\"\n                    ><\/i>\n                <\/button>\n                <button\n                    class=\"was-this-helpful__feedback-button was-this-helpful__feedback-button--cancel fl-button primary disabled\"\n                    type=\"reset\"\n                >\n                    <span class=\"fl-button-content\">Cancel<\/span>\n                    <i\n                        class=\"fa fa-times-circle medium\"\n                        aria-hidden=\"true\"\n                    ><\/i>\n                <\/button>\n            <\/div>\n        <\/form>\n    <\/div>\n    <div class=\"was-this-helpful__thank-you-message\" role=\"status\">\n        <i class=\"was-this-helpful__thank-you-message-icon fa fa-check\"><\/i>\n        <p class=\"was-this-helpful__thank-you-message-text\" aria-live=\"polite\"><\/p>\n    <\/div>\n<\/div>\n\n\n    <\/div>\n    \n    <div class=\"fl-section-sidebar\">\n        <div class=\"fl-editors-summary\" data-testid=\"fl-editors-summary\">\n    \n    <div class=\"fl-editors-summary-content\" data-testid=\"fl-editors-summary-content\">\n                    <h2>Can I Solve This on My Own or Do I Need an Attorney?<\/h2>\n                <div class=\"fl-editors-summary-content-main\" data-testid=\"fl-editors-summary-content-main\">\n            \n        <\/div>\n        <ul class=\"fl-list-style-none\">\n                            <li data-testid=\"fl-editors-summary-content-item\">\n                    <i class=\"fa fa-check medium fl-editors-summary-content-item-icon\" aria-hidden=\"true\"><\/i>\n                    Medicare and Medicaid issues can often be handled on your own\n\n                <\/li>\n                            <li data-testid=\"fl-editors-summary-content-item\">\n                    <i class=\"fa fa-check medium fl-editors-summary-content-item-icon\" aria-hidden=\"true\"><\/i>\n                    Attorneys are helpful when the 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<\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"<p>The Anti-Kickback Statute helps prevent health care fraud across the country. 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