What is the False Claims Act and Anti-Kickback Statute?

When our health is at its most vulnerable, we turn to our physicians to aid us in recovery. As patients, we place an enormous amount of trust into our physicians’ hands. We rely on their judgment and medical training to determine what course of action is best for our well-being. Trust is crucial in a patient-physician relationship.

false claims law

While most physicians strive to perform as honestly and ethically as possible, there are some providers who exploit the health care system for personal gain. In order to combat this behavior, the federal government has instituted fraud and abuse laws. These laws were created to ensure that physicians submit truthful and accurate claims to ensure that patients receive appropriate and high-quality health care treatment.

False Claims Act

The False Claims Act (FCA) safeguards the government against being overcharged or provided substandard goods or services. It is illegal to submit Medicare or Medicaid claims that you know or should know are false or fraudulent.

False claims can result in sanctions of up to three times the program's loss plus an additional $11,000 per claim. Each instance of an item or a service billed to Medic under the civil FCA counts as a claim, so fines can add up quickly. The fact that a claim is made in violation of the Stark legislation or as a result of a kickback may make it false or fraudulent, triggering liability under the civil FCA as well as the Anti-Kickback Statute or Stark law.

False allegations can result in prison time and monetary penalties. Physicians have been sentenced to prison for submitting fake health-care claims. The Office of Inspector General (OIG) may also impose administrative civil monetary penalties for inaccurate or fraudulent claims.

Anti-Kickback Statute

The Anti-Kickback Statute (AKS) is a federal statute that forbids the payment of "remuneration" to promote or reward patient referrals or the production of commerce involving any item or service that is paid for by the federal health-care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Anything of value can be considered remuneration, and it can take many forms other than money, such as free rent, expensive hotel stays and meals, and exorbitant compensation for medical directorships or consultations. In some businesses, rewarding individuals who suggest business to you is permissible. Paying for referrals, however, is illegal in federal health-care systems. The law applies to both the benefactors of kickbacks (those who offer or pay money) and the recipients of kickbacks (those who solicit or receive remuneration). Under the AKS, each party's intent is a critical factor in determining their liability.

Even if the physician did not have the explicit intent to violate the Anti-Kickback Statute, claims for payment to Medicare or Medicaid that include items or services arising from a breach of the Anti-Kickback Statute are considered false claims under the False Claims Act. Providers may not argue that they were violating the FCA because they were unaware of the Anti-Kickback Statute.

Fines, prison terms, and removal from federal health-care programs are among the criminal and administrative punishments for breaching the AKS. Physicians who pay or accept kickbacks are subject to fines of up to $50,000 per kickback plus three times the amount of the reward under the Civil Monetaries Penalty Law (CMPL).

Safe harbors shield the AKS from criminal and civil liability when it comes to certain payment and business operations. A safe harbor arrangement must fit squarely within the safe harbor and meet all of its standards to be protected (e.g. personal services and rental agreements, investments in ambulatory surgical centers).

The restriction on kickbacks extends to all referral sources, including patients.

For example, where the Medicare and Medicaid programs compel patients to pay copays for services, you are typically required to collect that money from them.

Waiving these co-pays on a regular basis could put you in violation of the AKS. You are not allowed to advertise that you'll pardon them. You may, however, waive the copay if you make an individual judgement that the patient cannot afford to pay or if your reasonable collection efforts fail. You may also provide uninsured patients with free or subsidized services.

To learn more about how to comply with federal healthcare laws or if you have any questions regarding the False Claims Act (FCA), Anti-Kick Statute (AKS), or other fraud and abuse laws please contact the best Medicaid Fraud Attorney at the Law Office of Inna Fershteyn at (718) 333-1233. 

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