Managing Financial Interests: The Anti Kickback Statute (AKS)

Transcription

1 Managing Financial Interests: The Anti Kickback Statute (AKS) Board of Commissioners Meeting February 15, 2012 Presented by: Mic Sager, Compliance Officer

2 Context: Business Transactions o Health Care is Different Than Any Other Business o Commonly Accepted Business Practices Are Illegal in Health Care o Business Arrangements Between Different Types of Health Care Providers, Practitioners and Suppliers, if Not Carefully Structured, May Implicate Criminal, Civil and Administrative Penalties

3 Federal Agencies o HHS 195: Requirements for Recipients of Federal Research Dollars to Manage Financial Interests and Conflicts o OIG 2003: Guidance to Pharmaceutical Manufacturers 10 other types of health care entities Strengthened or strengthening earlier guidance to hospitals and nursing facilities

4 History of Federal AKS o 1966: Medicare and Medicaid Created o 1972: Amendments to the Social Security Act Prohibiting Kickbacks Involving Medicare and Medicaid Programs (P.L ) o 1977: Medicare/Medicaid Anti Fraud and Abuse Amendments of 1977 (P.L ) Attempted to Provide Greater Specificity re: Prohibited Conduct o 1980: Omnibus Reconciliation Act of 1980 (P.L )

5 History of Federal AKS (cont.) o 1987: Medicare/Medicaid Patient Protection Act of 1987 (P.L ) o 1996: Health Insurance Portability and Accountability Act / HIPAA (P.L ) o 1997: Balanced Budget Act of 1997 o 2003: Medicare Drug Prescription and Improvement Act (P.L )

6 Today o AKS Prohibits Knowingly and willfully Soliciting or receiving Remuneration Directly or indirectly In return for the referral of items or services In return for purchasing, leasing, ordering or arranging for the purchasing/leasing/ordering of items or services Paid for by federal health care programs

7 Penalties o Felony (DOJ) o Fined Not More Than $25,000 or Imprisoned for Five Years or Both (DOJ) o Exclusion from Federal Health Care Programs (OIG) Independent authority not dependent on a criminal conviction with a different level of proof o Civil Penalties in the Form of Treble Damages Plus $50,000 for Each Violation (OIG)

8 Breadth o Prohibited Conduct so Broad that it Implicates Nearly All Business Transactions in Health Care Involving Federal Health Care Program o Not Limited to a Particular Category of Health Care Provider o Statutory and Regulatory Exceptions or Safe Harbors o If within a Safe Harbor, then Immune from Prosecution

9 Statutory Safe Harbors o Discounts that are Disclosed and Reflected in Costs Contained o Payments by Employer to Employee for Bona Fide Services o Amounts Paid by Providers to a Group Purchasing Organization (GPO) o Waivers of Coinsurance Amounts for FQHCs o Certain Risk Sharing Arrangements o NOTE: Many of These are also Included, and Expanded Upon, in Regulatory Safe Harbors

10 Regulatory Safe Harbors Investment interests Space rental Equipment rental Personal services and management contracts Sale of practice Referral services Warranties Discounts Employees GPOs Waiver of beneficiary coinsurance Increased coverage, reduced costsharing/premiums by health plans Price reductions to health plans Practitioner recruitment Obstetrical malpractice subsidies Investments in group practices Cooperative hospital service arrangements Ambulatory surgical centers Referral arrangements for specialty services Price reductions to eligible managed care organizations Price reductions in certain managed care Ambulance replenishing Electronic prescribing Electronic health records and community wide information systems

11 Example of Safe Harbor o Personal Services Agreement in writing signed by the parties Covers all services between the parties If part time services, specify the intervals or schedule of services Aggregate compensation is set in advance, consistent with fair market value and is not determined in a manner that takes into account the volume or value of referrals or other business generated Services do not involve illegal business arrangements Aggregate services called for do not exceed those which are reasonably necessary to accomplish the commercially reasonable purposes

12 Recent Clarifications o Intent Standard: Recent clarification that there is no requirement for actual knowledge of or any specific intent to violate the statute o False Claims Act: Underlying violation of the AKS when submitting a bill is a false claim o Fact that AKS has no private right of action (i.e., a qui tam provision) no longer relevant

13 Case Law o Day V. Inland Empire Optical, 76 Wn.2d 407 (1969) Ophthalmologists owned an optical dispensing company on the first floor of their building Patients were encouraged through directing foot traffic and signs to take their prescriptions there Court found that stock ownership was compensation under the statute; location of dispensing business and signage was a referral

14 Recap o Broad Statutes Implicating Common Business Arrangements and Transactions o Statutory and Regulatory Safe Harbors, Primarily at the Federal Level o Key Interpretations Arising from Case Law o Advisory Opinions, Fraud Alerts and Industry Specific Program Guidance

15 Thank You! o Questions? Working together to provide excellence in health care.