What is the Anti Kickback Medicaid & Medicare Law?
Most crimes involve behavior that a person intuitively knows to be wrong, such as stealing or committing an intentional fraud, committing violence, or the possession or sale of drugs. However, there are some laws that criminalize actions that are not necessarily immoral or unethical but are prohibited in order to protect the integrity of certain government programs or interests. The Federal Medicare and Medicaid anti kickback statute is one of these laws.
A federal law makes it illegal and a criminal offense punishable by up to 10 years in prison for a person to receive kickbacks from Medicare or Medicaid payments by the government.
The Law States:
42 U.S. Code § 1320a–7b – Criminal penalties for acts involving Federal health care programs (b)Illegal remunerations
(1)Whoever knowingly and willfully solicits or receives any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind—
(A)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
(B)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, shall be guilty of a felony and upon conviction thereof, shall be fined not more than $100,000 or imprisoned for not more than 10 years, or both.
The interesting thing about this law is that it criminalizes and provides for serious prison time for activity that in many businesses and professions is completely legal and expected. There is not necessarily anything immoral or unethical in receiving a “kickback” in many business situations. Many businesses and professionals receive a “referral fees” when they refer a person to another professional or a business in return for a portion of the fee the business will receive as a result of the referral. The best example is the legal profession. It is a well established and accepted practice for a lawyer who refers a person to another lawyer to be paid a “referral fee” for referring that client to the other lawyer.
However, for medical providers or anyone doing business with them it is critical to be aware of this law and to be aware that accepting a “referral fee” or a “kickback” that is funded from Medicare or Medicaid payments could land you in prison.