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Five Tips For Anti-Kickback Compliance

The Doctor's Office, February 21, 2008
The price you may pay for being in violation of the anti-kickback statute is nothing to take lightly. There are fines of up to $25,000, imprisonment of up to five years, or both. A violation of the anti-kickback statute could also result in exclusion from the Medicare program.

The bottom line is that physicians must learn how to stay in compliance with this statute to ensure no unwanted penalties or troubles with the law, says Joseph J. Russo, Esq., founder and senior partner of Russo & Russo, LLP, in Bethlehem, PA. He offers the following five tips to physicians who may be in danger of these circumstances:

1. Be aware of several safe harbors to the federal anti-kickback statute. The government is most concerned about any incentive providers may have to overutilize governmental services. The following is a list of safe harbors to consider in your practice:

  • Investments in large publicly traded entities
  • Investments in smaller ventures
  • Lease of space and equipment rental
  • Personal services and management contracts
  • The sale of a practitioner practice
  • Referral services
  • Warranties
  • Discounts
  • Employee groups purchasing an organization
  • Waiver of beneficiary coinsurance
  • Deductible amounts
2. Implement and follow a compliance program for your practice. For example, Compliance Program Guidance, issued by the U.S. Department of Health and Human Services Office of Inspector General (OIG), provides nonbinding compliance guidance to providers who conduct business with Medicare, Medicaid, and other federally funded healthcare programs.

3. Educate yourself about the risks. The OIG set forth various risk factors applicable to physician practices, including improper inducements, kickbacks, and self-referrals. They include:

  • Financial arrangements with outside entities to whom the practice may refer federal healthcare program business
  • Joint ventures with entities supplying goods or services to the physician practice or its patients
  • Consulting contracts or medical directorships
  • Office and equipment leases with entities to which the physician refers
  • Soliciting, accepting, or offering any gift or gratuity of more than nominal value to or from those who may benefit from a physician practice's referral of federal healthcare program business
In order to keep current with this area of the law, a physician practice may obtain copies of the risk areas available on the OIG Web site. "It will include all relevant OIG Special Fraud Alerts and Advisory Opinions that address the application of the anti-kickback and physician self-referral laws," Russo says. "This is to ensure that the standards and procedures reflect current positions and opinions."

4. Ask yourself whether certain gifts are legitimate. According to the Compliance Program Guidance, the OIG goes on to state that any arrangements involving pharmaceutical or other gifts should be scrutinized, taking into account the following factors:

  • Is the gift or other benefit made to a person in a position to generate or influence business for the paying party?
  • Does the gift or other benefit take into account, directly or indirectly, the volume or value of business generated (e.g., is the payment or gift only given to persons who have prescribed or agreed to prescribe the product?)
  • Is the gift or the benefit more than nominal in value and/or does it exceed the fair market value of any legitimate service rendered to a payer?
  • Is the gift or benefit unrelated to any services at all other than the referral of federal healthcare business?

5. Develop standards and procedures to address arrangements with other healthcare providers and suppliers. Physician practices should also consider implementing measures to avoid offering inappropriate inducements to patients. The following are examples of such inducements:

  • Routinely waiving coinsurance or deductible amounts without a good faith determination that the patient is in financial need
  • Failing to make reasonable efforts to collect the cost-sharing amount from the patient

Shannon Sousa is the editor of The Doctor's Office. She may be reached at ssousa@hcpro.com. This story was adapted from one that first appeared in the February edition of The Doctor's Office, a monthly newsletter by HealthLeaders Media.