As previous False Claims Act (FCA) Fundamentals posts have discussed, the FCA, 31 U.S.C. § 3729, et seq., can be triggered by submitting claims tied to violations of certain federal statutes. This post will explain the basics of two such statutes: the Anti-Kickback Statute (AKS) and the Stark Law.
Anti-Kickback Statute
The AKS, 42 U.S.C. § 1320a-7b(b), prohibits any person or entity from knowingly and willfully giving, receiving, or soliciting “remuneration” in exchange for patient referrals under a federal healthcare program. In this context, the kickback (“remuneration”) can include any form of financial incentive that might encourage a provider to refer a patient, whether it is “in cash or in kind,” “direct or indirect,” or “overt or covert.” Indeed, courts have found that illegal remunerations can range from extravagant vacations for referring physicians to direct payments for sales representatives, and many things in between.
The AKS is an intent-based statute. Accordingly, a person can violate the AKS only if they act willfully and knowingly. To that end, some courts have held that it is not a defense to the AKS that the provider had other legitimate reasons to provide the remuneration, and that a provider can face liability if any one purpose of the remuneration is to induce a referral.
The AKS and its corresponding regulations include several “safe harbors” that exempt certain business arrangements from AKS liability. For example, the AKS includes safe harbors for...
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