As we reported earlier this month,  2023 marked a banner year in False Claims Act recoveries. The government and whistleblowers were party to 543 settlements and judgments, “the highest number of settlements and judgments in a single year,” totaling over $2.68 billion. Notably, as in prior years, “unlawful kickbacks,” remained a stated government priority:

Unlawful Kickbacks

Kickbacks paid or received by health care providers undermine the integrity of federal health care programs by tainting medical decision-making, increasing health care costs, and adversely affecting competition. Federal law prohibits the willful solicitation or payment of illegal remuneration to induce the purchase of a good or service paid for by a federal health care program.

A review of recent enforcement actions shows that this focus continues, and AKS enforcement remains strong. Over the six month period between February 1 and July 31, 2024, DOJ announced at least eleven enforcement actions, recovering over $137.5 million, from FCA actions alleging AKS violations.

Not only does this activity show continued robust enforcement of the AKS, but the underlying conduct also demonstrates the enduring creativity of those who prioritize profits over patients and the fact that “any remuneration” means just that.

The alleged kickbacks at issue in these resolutions include: commissions based on the volume and value of referrals (resolutions of $14.3 million and $5 million); agreements to purchase dialysis centers in foreign countries, uncollected management fees, and rights of first refusal ($34 million); lease payments, wellness health services, sports tickets, and meals ($19.4 million); consulting fees, intellectual property acquisition and licensing fees, registry payments, and performance grants of stock ($12 million); and payments disguised as office space rental fees and phlebotomy payments ($1.3 million).

Defendants engaged in these kickback schemes continue to try to chip away at the Anti-Kickback Statute, most recently by seeking to limit the utility of the False Claims Act to enforce the law. The battle to protect the statute and preserve its purpose – to keep money from improperly influencing medical decision-making – is ongoing. The government will continue to rely on whistleblowers to expose these schemes and prevent kickbacks, in all shapes and sizes, from impacting the provision of healthcare services and driving up the cost of healthcare for all.

Molly Knobler was a former Partner at DiCello Levitt.