Referral fees, also known as kickbacks, are payments that medical service providers give to doctors in exchange for the doctor referring patients to that service.
There are numerous federal laws that prohibit referral fees. These are known as “Anti-kickback statutes”. A few examples of these are the Medicare and Medicaid Patient Protection Act of 1987 and the Stark Act. These laws allow for only a few, limited exceptions:
In addition to these federal laws, each state often has its own set of laws to prohibit kickbacks.
The penalties for violating federal anti-kickback statutes can be quite severe. For example, violations of the Medicare and Medicaid Patient Protection Act of 1987 are considered to be felony criminal offenses. The defendant may face criminal consequences including fines of up to $25,000, and imprisonment for a period of up to 5 years.
Liability for illegal referrals is often the result of an interaction between both the Medicare and Medicaid Patient Protection Act and the Stark Act. Thus, a physician may face criminal penalties on several different grounds, since both acts cover different aspects of illegal kickbacks.
The Office of the Inspector General (OIG) investigates doctors who make investments in clinics by investing capital or making loans. The OIG especially is concerned with doctors who are asked to invest based on the number of referrals they make to the clinic. However, the OIG has created safe harbors that permit doctors to have certain types of joint ventures.
Violations of referral fee laws are taken very seriously and the laws themselves are very complex. If you have a referral fee law problem you should consider speaking with a personal injury attorney. An experienced lawyer can look at your case to determine the best way to handle your referral fee problem.
Last Modified: 04-24-2018 01:51 AM PDTLaw Library Disclaimer
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