Anti-Kickback Statute and Stark Law Whistleblower Attorneys

Predicated FCA Claims

A violation of the False Claims Act can be predicated, or based on, the violation of another statute, regulation, or contract. Many government programs require participants to represent that they are not violating any such laws in connection with their involvement with the program. Medicare and Medicaid in the health care context, for example, require participating providers to certify that their claims for reimbursement comply with various laws, including specifically the Anti-Kickback Statute (AKS) and the Physician Self-Referral Law (commonly referred to as the Stark Law). A participant may violate the False Claims Act when they knowingly and falsely make (or cause to be made) such certifications of compliance in connection with a claim for reimbursement.

What is the Anti-Kickback Statute?

The AKS is a federal law that aims to prevent fraud and abuse in the health care system by prohibiting the exchange of something of value, a bribe, or a “kickback”, with the intent to induce a referral to a government program, like Medicare and Medicaid.

The AKS may be implicated when a pharmaceutical or medical device company provides the following to physicians, for example, with the intent to persuade the physician to prescribe their drug or use their device:

• Lavish vacations disguised as conferences
• Suspect compensation above market value for training, speaking, or consulting
• Meals, prizes, or other items of value
• Valuable marketing to promote the physicians’ practice
• Referrals arrangements
• Co-payment waivers

What are “Safe Harbor” Provisions?

The AKS has exceptions in the form of “safe harbor” provisions that protect certain payments and business practices that have been deemed presumptively not to be abusive. These safe harbors are specific and include things like discounts given in the normal course of business, payments to bona fide employees, and payments to group purchasing organizations.

All of the requirements of a safe harbor must be met for a safe harbor to exempt kickbacks. The AKS is a complex law with many nuances, so healthcare providers and companies must be careful to ensure that their practices comply with the statute to avoid any potential legal issues. A Nichols Kaster qui tam lawyer may be able to help you determine whether a company violated the AKS, outside the protection of its safe harbors, with a particular arrangement.

What is the Stark Law?

The Stark Law is a federal statute that prohibits physicians from referring patients to receive “designated health services” payable by a government health care program from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies. In its simplest terms, it prohibits self-referrals. It is designed to prevent conflicts of interest in physician referrals.

Imagine a doctor who owns a part of a lab. The Stark Law may prevent this doctor from sending patients to that lab for tests because the doctor could financially benefit from their own referrals. This could lead to unnecessary tests or higher costs. As another example, the Stark Law prohibits hospitals from compensating physicians with commercially unreasonable compensation structures above fair market value.

What is a Stark Law Violation?

A violation occurs when a physician makes prohibited referrals and the entity then bills a government health care program for those services. If a healthcare provider is found to have knowingly violated the Stark Law, and in turn the False Claims Act, they could face significant fines and be barred from participating in government health care programs, including Medicare or Medicaid.

In some circumstances, an illegal arrangement may violate both the Anti-Kickback statute and the Stark Law. It is important to remember, however, that the Stark Law, like the AKS, has exceptions that, when met, permit certain types of arrangements. A Nichols Kaster qui tam lawyer may be able to help you determine whether a particular arrangement violates the AKS or the Stark Law and whether it may in turn lead to a violation of the FCA.