Anti-Kickback Statute for Chiropractic Physicians

In some business sectors, it is totally acceptable to offer or receive gifts to reward past or future referrals; however, this is not the case in health care.  The Anti-Kickback Statute prohibits asking for or receiving anything of value in exchange for referrals of Federal health care program business.  In fact, to do so is considered a crime.  This applies to both the payers and recipients of kickbacks.  Just asking for or offering a kickback could violate the law.  (See Section 1128B(b) of the Social Security Act (the “Act”), 42 U.S.C. § 1320a-7b(b). 

It doesn’t matter if the activity occurs directly, indirectly, overtly, or covertly.  This applies if the remuneration is monetary or anything of value. Examples might include:

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• Cash
• Cash equivalents
• Cost-sharing waivers
• Subsidies
• Free rent
• Below market value rent
• Free clerical staff
• Excessive compensation for medical directorships
• Opportunities to earn a fee, item, space, equipment, or services

The amount makes no difference.  The underlying criterion is that the purpose of the remuneration is to induce referrals for items or services reimbursable by a Federal health care program.  For example, an orthopedic surgeon was recently accused of accepting kickbacks from device manufacturers for preferentially using their artificial hip and knee joints.  He paid $650,000 to settle the case. 

Violation of the Federal anti-kickback statute is a felony punishable by a maximum fine of $100,000, imprisonment up to 10 years, or both.  Conviction also leads to mandatory exclusion from Medicare and Medicaid, which is considered a “death sentence” by some, given that providers cannot receive payment from any Federal program, if excluded.  Violators can be found liable under the False Claims Act as well.   

The Anti-Kickback Statute is also implicated when providers give patients financial incentive to use their services.  Providers are not prohibited from offering free care to Medicare and Medicaid patients; however, they cannot waive copays and then bill CMS.  Providers can waive a copayment if it has been determined that a patient cannot afford to pay, or reasonable collection efforts fail.  However, advertising that a practice has a policy of forgiving copayments is prohibited.  Yet, discounts can be offered to uninsured patients.

There are some circumstances that are exceptions, called “safe harbors.”  All conditions of the safe harbor must be met, and such arrangements should be carefully reviewed, including outlining the intent of the parties involved.  The following are factors used to determine if an arrangement is problematic under the Anti-Kickback Statute.  (See the Office of Inspector General’s (OIG) General Compliance Program Guidance (GCPG), published November 2023)

• Can the two parties influence each other’s Federal health care program business?
• Were the parties selected for the arrangement because of past or expected referrals?
• Is the remuneration related in any way to the value of the business generated?
• Is the remuneration at fair market value?
• Are the items or services needed and rendered for legitimate business purposes?
• Does the arrangement affect the costs of a Federal health care program?
• Does the arrangement skew clinical decision making?
• Are patients steered towards a particular item or service?
• Does the arrangement impact the objectivity of professional judgment?
• Is the arrangement fully documented in writing?

In 2024, the US Attorney’s office in Oklahoma released information regarding a chiropractor who paid $365,000 to resolve allegations that he wrongfully paid physicians to induce referrals of patients needing durable medical equipment (“DME”), resulting in the submission of false claims to the Medicare program.

If an individual or entity identifies potentially problematic arrangements, they may self-report to the Office of the Inspector General (OIG).  It may be wise to consult with a health care attorney first, as there may be some significant subjectivity involved in these kinds of cases.  In any event, as part of an OIG Compliance Plan, every chiropractic physician should have policies and procedures in place to minimize potential problems with the Anti-Kickback Statute. 

Note: This article is Part 2 of 5: Compliance Laws Every Chiropractic Physician Should Know

• Part 1: The False Claims Act for Chiropractic Physicians
• Part 2: Anti-Kickback Statute for Chiropractic Physicians
• Part 3: Self-Referral Law for Chiropractic Physicians
• Part 4: Exclusion Authority Requirements for Chiropractic Practices
• Part 5: Civil Monetary Penalties, OIG, and the Chiropractic Practice