Basics of the Anti-Kickback Statute

Key Takeaway:

The Anti-Kickback Statute is aimed at curbing abuse and fraud in the Medicare and Medicaid systems by professionals who offer services and benefit in direct or indirect ways.

In order to protect Medicare and Medicaid patients, as well as federal health care programs from abuse and fraud; the Anti-Kickback Statute was enacted. The core act that the Anti-Kickback Statute considered as fraud and abuse is the unlawful acceptance or diversion of money into influencing medical decision-making.

The Anti-Kickback Statute is very clear on this. It states that anyone in the healthcare industry, who consciously and deliberately accepts a fee or remuneration of any kind or offers the same with the intention of manipulating the course of a medical decision-making, is liable to punishment.

What acts attract penalties?

Acts of various kinds attract penalties under the Anti-Kickback Statute. Some of these include:

  • Carrying out advertising or marketing activities for promoting the brand of health care providers
  • Participating in affiliate programs or pay per click commissions
  • Working out promotion agreements with multiple companies
  • Taking part in sponsorships
  • Working out strategic alliances with healthcare providers
  • Licensing content or technology
  • Selling a healthcare provider's brands of products or services
  • Taking a cut in the advertising revenue

The nature of penalties under the Anti-Kickback Statute

The Anti-Kickback Statute states major penalties for acts it prohibits. The Anti-Kickback Statute prescribes these major penalties:

  • Up to five years in prison
  • This has the potential to attract additional monetary fines of up to $25,000
  • Administrative civil money penalties that can go up to $50,000

In addition, the Office of Inspector General (OIG) could initiate administrative proceedings and take steps aimed at prohibiting anyone convicted of an Anti-Kickback violation from participating in State and federal programs.

The OIG could also impose civil monetary penalties for acts that it classifies as frauds, kickbacks, or other prohibited activities.

Exceptions to the Anti-Kickback Statute

The Congress offers remedies or protections for a number of situations that exempt people from prosecution. Congress has prescribed exceptions for a variety of circumstances that are exempt from prosecution under the Anti-Kickback Statute. Called "safe harbors", these exceptions are aimed at insulating prescribed behavior from prosecution under the Anti-Kickback Statute. These safe harbors allow remuneration to be made in circumstances that are considered mitigating. These are some of the examples of "safe harbors":

  • Bona fide employees
  • Electronic health records arrangements
  • Space and equipment rental
  • Personal services and management contracts
  • Electronic prescribing arrangements

Federal and State Anti-Kickback Statute

The Congress permits States to formulate their own Anti-Kickback Statute, so long as the spirit of the Act is retained and alterations made purely to suit local situations and realities.

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