Four individuals have been sentenced for their roles in a conspiracy involving kickbacks for prescription referrals, US Attorney Nicholas J. Ganjei announced on May 8. Each of the defendants had previously pleaded guilty.
One defendant was sentenced to 60 months in federal prison. Two others received 46-month sentences, while the fourth was sentenced to 30 months. All four will also serve three years of supervised release after completing their prison terms.
The first defendant, a former licensed pharmacist, owned and operated a pharmacy. He conspired with the other three defendants, described as “marketers,” to pay kickbacks to medical providers in exchange for prescription referrals. He then billed various benefit programs—including the Department of Labor, TRICARE, and Medicare—for millions of dollars. Between 2014 and 2016, his pharmacy submitted over $110 million in claims for compound drugs to federal healthcare programs.
“Illegal kickbacks are the engine that drives healthcare fraud,” said Ganjei. “Our office will aggressively pursue fraud, waste, and abuse that cost taxpayers millions, if not billions, every year.”
Compliance Perspective
Issue
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded healthcare programs. It is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients. The prohibition against kickbacks applies to those who pay for referrals and to those who receive them. Kickbacks can take various forms, such as bribes or rebates. They can be given in cash or in kind. Failure to promptly report a kickback can result in lawsuits, fines, and other sanctions.
Discussion Points
- Ensure your policies and procedures for preventing and reporting anti-kickback violations are current. Update them as necessary to align with federal and state regulations.
- Provide comprehensive training for all staff on federal and state anti-kickback statutes, including what constitutes a kickback and the reporting process for concerns or suspected violations. Emphasize the importance of prompt reporting and document all training sessions.
- Periodically audit staff understanding to ensure that they are aware of what should be done if they suspect an illegal kickback has occurred, whether intentionally or unintentionally. Conduct audits of documentation and billing routinely to prevent and detect errors before they progress to a false claim.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*