Purpose of the Statute
The Anti-Kickback Statute (AKS) is a federal criminal law that prohibits the exchange, or offer of exchange, of anything of value in an effort to induce or reward referrals of business reimbursable by federal healthcare programs. The goal is to prevent financial incentives from corrupting medical decision-making.
Prohibited Conduct
The AKS covers a broad range of remuneration, including cash payments, free services, excessive compensation arrangements, and below-market rents when offered to induce referrals. Both parties to an improper arrangement, the one offering and the one receiving remuneration, can be held liable.
Safe Harbors
Because the statute is written broadly, the Department of Health and Human Services created safe harbor regulations describing specific arrangements that will not be prosecuted, provided all conditions are met. Common safe harbors include certain employment relationships, space and equipment rentals, and personal services agreements that meet fair market value and commercial reasonableness standards.
Penalties
Violations of the AKS can result in criminal fines, imprisonment, and exclusion from federal healthcare programs. Civil monetary penalties and False Claims Act liability may also apply when claims resulting from a kickback arrangement are submitted for payment.
Relationship to Stark Law
While both laws address improper financial relationships, the AKS requires proof of intent and applies to any referral source, whereas Stark Law is a strict liability civil statute limited to physician self-referrals for designated health services.
Enforcement Examples
Common enforcement actions involve improper marketing arrangements between hospitals and referring physicians, illegal remuneration for laboratory referrals, and kickbacks tied to durable medical equipment prescriptions.
Exam Tip
Remember that intent matters under the AKS, unlike Stark Law which does not require proof of intent.