Understanding the Implications of the Federal Anti-Kickback Statute and its Florida Counterpart, the Patient Brokering Act

Posted on Health Care Law News May 13, 2022 by Erin Ferber

The Federal Anti-Kickback statute (“AKS”) is a criminal statute that prohibits the exchange (or offer to exchange), anything of value, in an effort to induce (or reward) the referral of business reimbursable by Medicaid, Medicare, or any other federal health care program. Conviction for a single violation under the Federal Anti-Kickback Statute may result in a fine of up to $25,000 and imprisonment for up to five (5) years. In addition, a conviction will lead to a mandatory exclusion from participation in federal health care programs and can carry with it significant negative professional licensure implications. A violation of the Anti-Kickback Statute may also result in significant administrative penalties, including large civil monetary penalties, which may include treble damages plus $50,000 for each violation of the Anti-Kickback Statute. While the Federal Anti-Kickback statute applies only to arrangements involving federal governmental payers, Florida’s Patient Brokering Act (“PBA”) is much broader, and applies to all payers, even arrangements involving self-payment. Much like the Federal AKS, Florida’s PBA includes various safe harbors however, the PBA includes safe harbors for arrangements such as those that are not prohibited by the Federal Anti-Kickback Statute.

It is imperative that the application of these statutes as well as the safe harbors and statutory exceptions that protect certain types of referral arrangements are carefully examined by experienced legal counsel, as these laws regularly affect the daily practices involved with being a healthcare professional. The analysis of these statutes and the accompanying exceptions can be a complicated task, specifically where there is more than one legitimate purpose for an arrangement, but a less apparent purpose involves an incentive to refer patients between the parties. A Federal Court has opined that even if one purpose of the remuneration is to induce referrals, the statute is violated, regardless if the payment was also intended for a legitimate purpose.

Any individual in a position to refer patients in the healthcare industry, whether it be a doctor, dentist, pharmacist, nursing home or drug treatment facility, should evaluate his or her compliance with these statutes with respect to any business arrangement that could potentially involve a source of referrals for either party.

Nicholson &, Eastin, LLP is highly experienced in evaluating a wide array of business arrangements and advising clients on the risks associated with certain arrangements, as well as recommending precautions and best practices related to same. If you are a professional in the healthcare industry and have any questions or concerns regarding the Federal or state anti-kickback statutes discussed briefly above, please do not hesitate to contact us for a consultation.