Anti-Kick Back Qui Tam Cases

Federal healthcare programs such as Medicare and Medicaid prohibit pharmaceutical manufacturers, physicians, pharmacists, and other healthcare professionals from offering or receiving anything of value in exchange for:

• Referrals of Medicare or Medicaid patients, or
• The ordering of goods or services reimbursed by those programs.

These incentives, known as kickbacks, violate the Anti-Kickback Statute (AKS) and can trigger False Claims Act (FCA) liability under the implied false certification theory.

When a provider submits a claim for Medicare or Medicaid reimbursement, they are implicitly certifying compliance with all relevant statutes and regulations, including the AKS.

If a violation exists, that certification is false—creating potential FCA exposure.

False Claims Act Liability

Violations of the Anti-Kickback Statute may, depending on the jurisdiction, be sufficient to trigger False Claims Act liability.

Even when the healthcare provider actually rendered the billed services, those claims are considered “tainted by fraud” if kickbacks influenced the transaction.

Importantly, courts have held that the government or relator (whistleblower) does not need to prove actual damages to bring a valid FCA claim.

Elements of an AKS Violation

To establish a violation of the Anti-Kickback Statute, a qui tam whistleblower must show that:

1. Remuneration was provided by a healthcare provider; and
2. The remuneration was offered to induce referrals of Medicare or Medicaid patients, or to influence the ordering of reimbursable goods or services.

When these elements are met, a whistleblower may pursue action under the FCA.

Pharmacy Benefit Managers (PBMs) and Kickbacks

The growth of pharmacy benefit management companies (PBMs) has intensified focus on anti-kickback enforcement.

PBMs act as intermediaries between drug manufacturers and health plans, managing prescription drug benefits by:

• Negotiating rebates and discounts
• Administering mail-order pharmacy programs
• Managing disease treatment programs

While PBMs can improve efficiency, they must not solicit or accept improper payments from drug manufacturers in exchange for favoring certain drugs or influencing formulary placement.

Medical Practice Acquisitions and Kickbacks

When healthcare providers acquire medical practices in violation of the AKS and then bill Medicare, those claims can be considered false under the FCA.

To comply with the law, acquisitions must be conducted at fair market value and free of referral inducements.

If a whistleblower can show that a provider overpaid for a practice to secure future referrals, the provider may face FCA liability.

Whistleblower Actions and Protections

Whistleblowers play an essential role in uncovering kickback schemes and protecting public funds.

Individuals with firsthand knowledge of Anti Kickback Statute violations can take action under the False Claims Act and help hold healthcare providers, pharmaceutical companies, and intermediaries accountable.

Notice

This website is designed to provide general information only. This information is not and should not be construed to be legal advice. The transmission of the information found on this website also does not result in the formation of a lawyer-client relationship.

You should be aware that qui tam claims are subject to a Statute of Limitations. The area of limitations periods is complex. There are also first to file rules, public disclosure bars, original source issues, and varying limitations in pursuing retaliation claims. If you wish to pursue your claims, you should promptly seek the opinion of an attorney regarding the merits of your qui tam claim and the applicable statute of limitations.