The Medicare system has several rules and regulations in place to safeguard against healthcare fraud and protect federal funds. Two such laws are the Anti-Kickback Statute and Stark Law.
It is important that healthcare providers intimately understand both laws and that they have processes in place to prevent the violation of them. Failure to implement such processes may result in civil or even criminal penalties.
The Anti-Kickback Statute
According to the Centers for Medicare and Medicaid Services, the AKS makes it illegal for any healthcare provider to willfully and knowingly solicit, offer, pay or receive any remuneration in an effort to directly or indirectly encourage or reward patient referrals or generate business for services or items for which a Federal health care program will be financially responsible. Remuneration can come in several forms, including cash, extravagant meals or hotel stays, free rent, excessive compensation for consultations or anything else of value.
A violation of the AKS may result in a criminal charge. The penalty for a conviction may include a fine of up to three times the amount of the kickback, prison time and up to $100,000 per kickback.
How Stark Law differs
According to the Office of Inspector General, the AKS and Stark Law differ in two distinct ways. The first is that an AKS violation occurs when a healthcare provider receives remuneration from anyone. A Stark Law violation only occurs if a physician refers a Medicare patient to another physician with whom the referring physician has a financial or familial relationship. The second major distinction involves the type of charges violators face. An AKS violation can result in criminal penalties, whereas a Stark Law violation can only result in civil sanctions.
A few other, minor distinctions exist as well. For example, the AKS prohibits the referral of “items or services,” while Stark Law only prohibits the referral of “designated health services.” Additionally, the AKS has an intent standard (the accused must have knowingly and willfully violated the law), while Stark Law does not. Rather, Stark Law holds physicians to a “strict liability” standard.