Anti-Kickback Laws

Whistleblowers play an instrumental role in helping law enforcement agencies enforce federal anti-kickback laws. Two of the most prominent anti-kickback laws specifically relate to federal healthcare programs.

Under 41 U.S. Code § 8701(2), a kickback is defined as “any money, fee, commission, credit, gift, gratuity, thing of value, or compensation of any kind that is provided to a prime contractor, prime contractor employee, subcontractor, or subcontractor employee to improperly obtain or reward favorable treatment in connection with a prime contract or a subcontract relating to a prime contract.”

Under the False Claims Act, whistleblowers who report Stark Act or Anti-Kickback Statute violations may be eligible for a reward, that can include possible compensation. Depending on the case, a whistleblower may be awarded up to 30 percent of the monetary sanctions collected from the violator.

Lawyer Discusses Anti-Kickback Laws in Philadelphia, New Jersey and New York

If you know of an anti-kickback law violation in Pennsylvania, New Jersey, or New York, it is in your best interest to retain legal counsel.

Console Mattiacci Law, LLC assists whistleblowers in the greater Philadelphia area, including Montgomery County, Chester County, Bucks County, Lancaster County, and Delaware County in Pennsylvania as well as Monmouth County, Ocean County, Atlantic County, Camden County, Burlington County, and Mercer County in New Jersey.

The $1.678 million our firm obtained on behalf of a whistleblower was the largest employment law verdict in Pennsylvania in 2013. You can have our Philadelphia employment law attorneys review your case and answer all of your legal questions as soon as you call 215-545-7676 to receive a free initial consultation.

Anti-Kickback Statute Violations in Pennsylvania, New Jersey, and New York

The federal Anti-Kickback Statute (AKS) is established under 42 U.S.C. § 1320a–7b(b). It is a felony under 42 U.S.C. § 1320a–7b(b)(1), punishable by up to five years in prison and a fine of up to $25,000. It is a violation of AKS for a person to knowingly and willfully solicit or receive any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind:

  • in return for referring an individual to a person for the furnishing or arranging for the furnishing of any item or service for which payment may be made in whole or in part under a federal health care program; or
  • in return for purchasing, leasing, ordering, or arranging for or recommending purchasing, leasing, or ordering any good, facility, service, or item for which payment may be made in whole or in part under a federal health care program.

It is also a felony punishable by up to five years in prison and a fine of up to $25,000 under 42 U.S.C. § 1320a–7b(b)(2) for a person to knowingly and willfully offer or pay any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind to any person to induce such person:

  • to refer an individual to a person for the furnishing or arranging for the furnishing of any item or service for which payment may be made in whole or in part under a Federal health care program; or
  • to purchase, lease, order, or arrange for or recommend purchasing, leasing, or ordering any good, facility, service, or item for which payment may be made in whole or in part under a Federal health care program.

Several exceptions to these laws are established under 42 U.S.C. § 1320a–7b(b)(3). Additional “safe harbors” can be found under 42 C.F.R. § 1001.952.

Stark Act Violations under Federal Law

The Stark Act under 42 U.S. Code § 1395nn is similar to the Anti-Kickback Statute in that both concern possible violations of federal health care laws, but there are some notable differences between these two laws. For example, while the Anti-Kickback Statute applies to all federal healthcare programs, the Stark Law only applies to Medicaid or Medicare.

Criminal intent is required to prove an Anti-Kickback Statute violation, but a Stark Act violation involving an overpayment is strict liability. Additionally, the Anti-Kickback Statute can involve referrals from anyone while the Stark Act is limited to referrals from physicians.

The Stark Act is named after Congressman Pete Stark, the original sponsor of the bill in the United States Congress. The Stark Law prohibits a physician from referring any designated health services payable by Medicare or Medicaid to an entity with which the physician or an immediate family member has a financial relationship.

Such an entity is also prohibited from billing any individual, third party payor, or other entity for designated health services furnished pursuant to a prohibited referral.

Like the Anti-Kickback Statute, the Stark Act also has several exceptions. Stark Act violations do not carry criminal penalties but can involve many different civil penalties, including civil monetary penalties of $15,000 for each service and civil monetary penalties of $100,000 for every arrangement considered to be a circumvention scheme.

Violations can also result in civil assessments of up to three times the amount claimed as well as possible False Claims Act liability.

Additional Resources

What Is the Anti-Kickback Statute? | Young Lawyers Division — The American Bar Association (ABA) Young Lawyers Division includes ABA law student members, ABA members who have completed the bar exam, ABA members who are under 36 years of age, and ABA members who have been members for five years or less. Visit this section of the Young Lawyers Division section of the ABA website to view the full text of an article discussing the Anti-Kickback Statute. The article covers the many changes to the law since its original passage in 1972.

Stark Regulation: A Historical and Current Review of the Self-Referral Laws | ResearchGate — View the full text of a paper examining the Stark Act and related self-referral laws. The paper touches on the statutory history of physician self-referral, Stark regulations and the anti-kickback statutes, and the pros and cons of influence on self-referral. You can also learn more about studies on joint-ventures and self-referral.

Find an Anti-Kickback Law Attorney in Philadelphia, PA, New Jersey and New York

Do you believe that you may know of an illegal kickback scheme in Pennsylvania, New Jersey, or New York? You will want to contact Console Mattiacci Law, LLC for assistance with any whistleblower claim.

Our experienced employment lawyers in Philadelphia also handle qui tam claims relating to kickback violations, which can entitle people to compensation.

Call 215-545-7676 or complete an online contact form to have our attorneys provide an honest and thorough evaluation of your case during a free, no-obligation consultation.

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