Anti-Kickback Statute

A federal criminal law that prohibits offering, paying, soliciting, or receiving anything of value to induce or reward referrals of items or services covered by federal healthcare programs.

The Anti-Kickback Statute, or AKS, makes it a federal crime to pay for referrals. If you pay someone to send patients to you, or someone pays you to send patients to them, and federal healthcare program dollars are involved, you have violated the AKS. This law is broader than the Stark Law. It applies to everyone in the healthcare chain, not just physicians. It covers any item or service reimbursable by a federal healthcare program, not just designated health services. And it covers both directions: paying for referrals and receiving payment for referrals. The AKS has safe harbors, which are specific arrangements that are protected from prosecution if all conditions of the safe harbor are met. Safe harbors exist for employment relationships, personal services contracts at fair market value, rental arrangements at fair market value, equipment sales at fair market value, and several other common business arrangements. Violations of the AKS carry serious penalties: criminal fines up to $100,000 per violation, imprisonment up to 10 years, civil monetary penalties up to $100,000 per violation, treble damages under the False Claims Act, and exclusion from federal healthcare programs. In credentialing, AKS compliance comes up in several ways. Payer applications may ask about your referral arrangements. If you are joining a group practice or an independent practice association, the financial terms of the arrangement need to comply with AKS safe harbors. If you receive any compensation tied to referral volume or value, that is a red flag. The practical advice is simple: never pay for referrals, never accept payment for referrals, and make sure all your compensation arrangements are at fair market value and documented. When in doubt, have a healthcare attorney review the arrangement before you enter into it.