Federal Anti-Kickback Statute – 42 U.S.C. § 1320a-7b

The Federal Anti-Kickback Statute makes it a crime to solicit or receive remuneration in exchange for referring patients for services when a federal health care program makes payment.

The primary function of the Anti-Kickback Statute is to eliminate fraud and abuse in our federal health care system by prohibiting illegal remuneration, which can occur in many forms, and frequently overlooked in business transactions, bonus incentive arrangements, discounts, and other forms of compensation arrangements.

Anti-Kickback statute prosecutions are often a part of an overall health care fraud prosecution, and even conspiracy.

In fact, violations of the Anti-Kickback Statute are a common form of health care fraud allegations in a federal government criminal investigation and physician disciplinary proceeding. These federal crime violations require two crucial elements; remuneration between parties and illegal intent.

Under federal law, there are significant criminal penalties for anyone who knowingly and willfully solicits, requests, or receives remuneration (payment). It’s often called a kickback, or bribe, in exchange for referring someone for treatment compensated by a federal health care program.

18 U.S.C. § 287, False Claims Act), makes it a crime to submit false, fictitious, or fraudulent claims.

Under 42 U.S.C. § 1320a-7b(b), any person is guilty of a felony offense if they either receive, or pay a bribe or kickback for referring people for treatment under a federal health care benefits program. It’s also a crime to purchase, lease, order, recommend, or arrange for the purchase of any good or service compensable by a federal healthcare program.

In order to give readers a better understanding of the Anti-Kickback Statute, our federal criminal defense lawyers are providing an overview.

How the Anti-Kickback Statute is Prosecuted

42 U.S.C. § 1320a-7b Anti-Kickback prosecutions are charged against people who are making money for recruiting and signing up patients for a federally-reimbursed healthcare program.

For example, let’s say a doctor pays a third-party a per-patient fee if they refer business to their office. The doctor will make a profit because they are treating more patients that can be reimbursed – most often at a high rate – directly paid by the federal taxpayer.

The person making the referral to the doctor’s office will also benefit directly through a bribe or kickback from the doctor.

This statute also applies for sales of healthcare related goods – not just the services.  For instance, a pharmacist who pays kickback to someone supplying patients who need high cost medical devices or prescription drugs, which are in turn reimbursed by a federal benefits program.

This type of criminal behavior can also be charged by a federal prosecutor under 42 U.S.C. § 1320a-7b Anti-Kickback Statute. It should be noted that not all compensation received from a federally reimbursable healthcare will rise to the level of an anti-kickback prosecution.

This federal statute exempts a discount or reduction in price obtained from a provider, or even services provided at the discount that are disclosed and stated in the claims for reimbursement that are submitted to the government.

On a similar note, employee compensation issues, as long as they have a legitimate relationship with the provider, won’t qualify as a kickback or bribe. There are also other provisions that exist which exempt specific business relationships from coverage of the statute.

The bottom line provisions of 42 U.S.C. § 1320a-7b Anti-Kickback Statute are primarily focused at the patient referral and kickback activity explained above, and not at valid healthcare providers who give services compensated by federal tax dollars.

Legal Penalties for Anti-Kickback Statute

The anti-kickback statute includes harsh penalties, even for anyone who is a first-time offender. If convicted for violating 42 U.S.C. § 1320a-7b a healthcare kickback, you could be facing 10 years in federal prison and a fine up to $100,000 fine.

However, it should be noted that federal sentencing is complex and always involves application of the Federal Sentencing Guidelines, considerations under 18 U.S.C. 3553(a) and other discretionary determinations of the judge.

This means the sentence will greatly vary from a sentence in a state court, which are determined by sentencing provisions.  It also means you will need an experienced criminal defense team to have the best chance at a favorable outcome.

Defenses for Anti-Kickback Statute

Any legal defense for violating 42 U.S.C. § 1320a-7b anti-kickback statute will always vary based on the specific circumstances of the case. However, there are several common effective strategies.

For example, there are several types of payments to various organizations or people that don’t fall within the coverage of this statute, known as “safe harbors.”

Thus, depending on the specific relationship between individual defendants, it might be possible to show the payments don’t even qualify as a kickback or bribe, but rather valid payments for services.

Next, any payments need to involve a federally administered healthcare benefit program.  Not counting any criminal exposure under a state law or potential consequences to a doctor’s license to practice medicine, if the kickback was paid to a patient referral source that are not connected to a federal benefits program, then the payments, while maybe unlawful by other statutes, won’t be covered under 42 U.S.C. 1320a-7b.

Federal Anti-Kickback Law Defense Lawyer

Federal healthcare fraud crimes, especially when they involve allegations of doctors being accused of paying or receiving kickbacks are very complicated criminal cases.

A conviction for violating the anti-kickback statute can result is a significant sentence in federal prison. If you have been accused a serious federal fraud crime, or already indicted in a federal court, call our seasoned federal criminal defense lawyers to review the details of the case.

We will closely review all the details in order to start developing a strategy to obtain the best possible outcome. Our defense lawyers can negotiate with the federal prosecutor on your behalf before the case goes to court to in an effort to achieve a favorable outcome.

Eisner Gorin LLP is a law firm dedicated exclusively to criminal defense with decades of combined experience in all types of federal cases. We serve clients nationwide on federal criminal cases from our law office located at 1875 Century Park E #705 Los Angeles, CA 90067. Call our office for a consultation at (877) 781-1570.