This is a more plausible interpretation of the commentary, given that the agency’s fully fleshed-out position on the meaning of the employee safe harbor has been stated several times in the decades since those initial comments through advisory opinions that HHS issued opining on “what constitutes prohibited remuneration within the meaning” of the AKS, as it is statutorily mandated to do. Instead, the defendants relied on her personal and professional contacts to obtains referrals. May 12, 2015),“Government Opposition to Motion to Dismiss,” at pp. Sign up to receive updates on the following legal topics: Attorney Advertising. Some courts interpret the AKS safe harbor as protecting traditional employment relationships that would allow compensation paid to employees for personally performed services reimbursable under a federal health care program, including incentive compensation tied to such services, but not compensation divorced from services that is paid solely for directing referrals to a particular provider. 2020 11-20-2020 Final Rule: Revisions to Safe Harbors Under the Anti-Kickback Statute, and Civil Monetary Penalty Rules Regarding Beneficiary Inducements. Thus, for example, the safe harbors for space and equipment leasing arrangements permits a medical provider to lease equipment or office space, provided the rent is consistent with fair market value and is not determined in a manner that takes into account the volume or value of patient referrals. § 411.357(c). Referrals themselves, however, have been held not to constitute a reimbursable item or service, and thus payments for referrals arguably do not fall within the literal scope of the safe harbor. (emphasis added), and were motivated by a rise in various health care fraud and abuse activities, including financial incentives to induce referrals of program business, medically unnecessary services and the “steering” of patients to “particular” providers, thus violating the “policy of freedom of choice.”[12] The U.S. Department of Health and Human Services was mandated, through legislation passed in 1987, to promulgate regulations establishing additional “safe harbors” for business arrangements and payment practices that would not be subject to prosecution under the AKS. §1001.952 (2018). 12-08, 2012 WL 4753655 (analyzing proposed compensation arrangement between a physician and an independent diagnostic testing facility providing home sleep testing services in which facility would pay physician to read and perform sleep studies and perform administrative duties and, after assuming physician would be bona fide employee, concluding arrangement was protected under safe harbor because the physician “would be compensated for furnishing a service for which payment may be made in whole or in part under Medicare, Medicaid or other Federal health care program”) (emphasis added); Advisory Opinion No. La. However, many providers are unaware of the requirements to fit squarely within this safe harbor — specifically, the issue of what constitutes an “employee” under the safe harbor regulation. 2014), vacated and remanded on other grounds, 136 S.Ct. [20] A safe harbor for management contracts and personal services similarly permits a medical practice to contract with an organization for administrative services, or a provider for personal services, provided the compensation paid is fair market value and, once again, is not determined based on the volume or value of any patient referrals generated for the practice. 2007) (affirming conviction under the AKS based on payments made to employee for patient referrals, where referral compensation was paid in separate checks from employee’s regular payroll checks). Exceptions to anti-kickback statutes Anti-kickback laws prohibit you from receiving any sort of financial remuneration regarding the referral of patients. L. No. ... and as reiterated by HHS-OIG in its preamble to the AKS final rule, failure to meet a safe harbor … False Unlike the mandatory exceptions under the Stark Law, compliance with safe harbors is voluntary and, therefore, not recommended. Under this statute, an employee is any worker that satisfies the common law rules for establishing employer-employee relationship. The Department of Health and Human Services (HHS) has taken further steps in its effort to create a more hospitable regulatory climate for innovation in health care by releasing extensive and significant revised final rules governing the Physician Self-Referral Law (Stark) and the Medicare Anti-Kickback Statute (AKS). There is a view shared by some compliance professionals that the employee safe harbors permit employers to do that which the AKS fundamentally prohibits — i.e., pay for referrals. Please click the link below to view the Health Law Bulletin - April/May 2010. For 35 years, Chapman Law Group has defended the rights of national health care professionals, providers, and corporations involved in the delivery of health care at all levels. La. v. AIDS Healthcare Foundation, the relator claimed that AHF, a nonprofit organization that provides medical services to patients with HIV/AIDS, paid kickbacks to employees in exchange for referring HIV-positive patients for health care services billed to federal health care programs in violation of the AKS and both the Florida and federal False Claims Acts … Advisory opinions issued by HHS consistently interpret the second clause of the safe harbor as requiring that the compensation under review be paid to the employee for furnishing covered items or services, and not merely for referrals. Adobe Reader is required to view... Get legal updates and news delivered to your inbox. § 1395nn; 42 C.F.R. It is the, It’s simple to define what kickbacks in health care are. However, in 2013, the 5th U.S. The federal Anti-Kickback Statute contains a statutory exception or “safe harbor” providing that the AKS will not apply to “any amount paid by an employer to an employee (who has a bona fide employment relationship with such employer) for employment in the provision of covered items or services.” 42 U.S.C. 248.644.6326F. Both the statutory and regulatory safe harbors require by their terms that the remuneration paid for which protection is sought, be for employment in furnishing or providing covered items and services. New Law Taking Effect 2021 Requires It, America’s Biggest Big-Box Retailer Accused of Aiding Pill Mills, The Estate Planning Checklist You Need as Your Parents Age, Historic Medicare Fraud Takedown Names 73 from Florida, 16 from Michigan, What Are the Penalties for Kickbacks in Health Care? 04-09, 2004 WL 5701854 (proposed arrangement between geriatric practice group and referring primary care physicians under which the latter would provide consulting services at an hourly rate was protected under employee safe harbor because, assuming bona fide status of employee, physicians would be paid “for the furnishing of covered items and services”; noting that AKS “disfavors payment structures that tie compensation, even for services, to patients referred by the compensated party” but creates exception where services are furnished by bona fide employees); Advisory Opinion No. § 411.357(c)(2)(ii). As used in section 1128B of the Act, “remuneration” does not include any payment that is a return on an investment interest, such as a dividend or interest income, made to an investor as long as all of … If a physician or medical provider uses any payment or compensation to encourage a patient, 1441 W Long Lake RoadSuite 310Troy, MI 48098T. In this regard, the HHS Office of Inspector General has observed that such pernicious behavior increases risks associated with “overutilization, increased program costs, corruption of medical decision-making, patient steering and unfair competition.”[16], Agency Interpretations of the Employee Safe Harbor, The employee safe harbor of the AKS contains two clauses. This codifies the statutory exception of remuneration related to incentive … [10] H.R. In addition, the courts have held that substance is more important than form, and the following factors should be considered when analyzing whether an individual or entity qualifies under the bona fide employee anti-kickback safe harbor: Courts have not been very consistent in analyzing the 13 factors and deciding what constitutes an “employee” — because, as previously stated, no one factor is determinative. Recent Anti-Kickback Safe Harbor Revisions: What Hospices Should Know January 06, 2021 The US Department of Health and Human Services Office of Inspector General (OIG) recently issued important updates to its Anti-Kickback Statute (AKS) safe harbor rules that provide additional legal protections and flexibilities, in particular with regard to value-based enterprise (VBE) … Reg. 305.712.7177. 1-2, Case No. The AKS has a broad impact on health care providers’ business arrangements, specifically when it relates to marketing agreements, because it criminalizes the payment of any funds or benefits designed to encourage a party to a Medicare provider for services to be paid for by the Medicare program. In one case, a Texas appellate court concluded that a contract between a hospital and a recruiter was not a violation of the federal AKS because the recruiter was an employee under the safe harbor provision. See 42 U.S.C. [13] By statute, in considering whether to protect a particular payment practice under a “safe harbor,” HHS is directed to consider a number of factors, including: Appx. [22] See, e.g., Investment interests also are protected under conditions specifically limiting the control of investors who are in a position to make or influence patient referrals and to ensure that investment interests are offered on terms that do not vary based on an investor’s ability to refer and do not require such referrals. [16] Discussion of AKS purposes on OIG website, at http://oig.hhs.gov/compliance/physician-education/01laws.asp. [4] Wall v. Vista Hospice Care Inc., 2016 WL 3449833 (N.D. Tex. The OIG finalized three new value-based arrangement safe harbors that were generally narrower than the Stark exemptions and aim to protect certain payments among individuals. 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