The Anti-Kickback Statute, 42 U.S.C. The most consistent challenge — and perhaps the most unique to healthcare — is satisfying the many laws and regulations in place when leasing space from certain healthcare providers to other healthcare providers. Stark Law prohibits physicians from making referrals for certain “designated health services,” which includes both inpatient and outpatient services, to entities in which the physician has a financial relationship. There are many unique obstacles when leasing healthcare properties. leased between the parties for the term of the lease and . Therefore, leasing space to a clinic that may refer patients to the healthcare system from time to time could violate the Anti-Kickback Statute unless carefully structured. Generally, payments of cash, payment above fair market value, and payments for services such as speeches that are never delivered or are worthless are considered kickbacks. and . Republished with permission. The Stark Law. by the parties • The lease . Anti-kickback changes add safe-harbor protections. The Anti-Kickback Statute is a criminal statute, but it provides both civil and criminal penalties for violations that do not fall within one of its safe harbors. Agreement must specify aggregate payment, and such payment must be set in advance. As indicated above, the final rule also creates two new safe harbors to the Anti-Kickback Statute. The Anti-Kickback Statute is a healthcare fraud and abuse statute that makes it illegal to exchange remuneration for referrals of services that are payable by Medicare and other federal program. The HHS Office of Inspector General (OIG) issued the final rule “Revisions to the Safe Harbors Under the Anti-Kickback Statute and Civil Monetary Penalty Rules Regarding Beneficiary Inducements,” and the Centers for Medicare and Medicaid Services (CMS) issued the final rule “Modernizing and Clarifying the Physician Self-Referral Regulations.” Accordingly, it is critical to document the methodology used to establish fair market value at that time. Enjoy the videos and music you love, upload original content, and share it all with friends, family, and the world on YouTube. Highlights from Anti-Kickback Statute Changes: New safe harbor for certain point-of-sale (POS) price reductions for prescription pharmaceutical products by a manufacturer to a Medicare plan sponsor or Medicaid managed care organization Agreement must set forth the exact services required to be performed. Compensation must not be determined in a manner that takes into account volume or value of referrals. Safe Harbor Regulations The "safe harbor" regulations describe various payment and business practices that, although they potentially implicate the Federal anti-kickback statute, are not treated as offenses under the statute. The arrangement must serve a commercially reasonable business purpose. Exception and Safe Harbor: Overview Stark and Anti-Kickback Law •Stark: In order for a lease arrangement with a referral source to be compliant with the Stark law, the leasing arrangement must meet all elements of the applicable Stark law exception •AKS: While failure to comply with the applicable AKS safe harbor provision does not Stark and Anti-Kickback Law Exception and Safe Harbor § 1320a-7b (b) (“AKS”), prohibits anyone from knowingly and willfully offering, paying, soliciting, or receiving remuneration in order to induce reimbursable business under federal or state healthcare programs. Due to the broad language of the anti-kickback statute, the Office of Inspector General has developed “safe harbor” regulations that protect arrangements that might otherwise violate the statute. § 1001.952. covers all of the premises. However it is established, fair market value should be assessed at the time of the lease agreement. Safe harbors to the anti-kickback statute The Anti-Kickback Statute laws do create “safe harbors,” which are ways/conduct that won’t qualify as violations of the Anti-Kickback Statute. Compensation must be fair market reasonable, fair market value and determined through arm’s length negotiations. If you share their questions and concerns, rest assured that in many cases supposed kickbacks are actually covered under federal safe harbor statutes. This statute prohibits anyone from knowingly and willfully offering, paying, soliciting, or receiving remuneration in order to induce business reimbursable under federal or state health care … The Anti-Kickback rule changes include a safe harbor for cybersecurity donations. Anti-Kickback Statute Safe Harbor: Personal Services and Management Contracts The Anti-Kickback Statute, 42 U.S.C. If You Believe a Person or Entity is Committing Healthcare Fraud, Contact an Experienced Berger Montague Attorney for a Free, Confidential Evaluation of Your Claim. Revisions to the Safe Harbors Under the Anti-Kickback Statute and Civil Monetary Penalty Rules Regarding Beneficiary Inducements, 81 Fed. False Unlike the mandatory exceptions under the Stark Law, compliance with safe harbors is voluntary and, therefore, not recommended. To be protected by a safe harbor, an arrangement must fit squarely in the safe harbor. Recently finalized changes to rules implementing the Stark Law and Anti-Kickback Statute — effective in January — drew support from provider groups. This article first appeared in Building Operating Management in March 2015. The safe harbors set forth specific conditions that, if met, assure entities involved of not being prosecuted or sanctioned for the arrangement qualifying for the safe harbor. The Anti-kickback Statute •Remuneration paid with the intent to induce referrals violates the Statute •Presumption that payment in excess of FMV or below FMV is payment for referrals •FMV is component of certain AKS safe harbors Specifically, leases of space in hospitals or hospital-owned medical office buildings implicate theAnti-Kickback Statute and Stark Law. These payment and business practices, although they potentially implicate the AKS, are not treated as offenses under the statute. (v) The entity may not use space, including, but not limited to, operating and recovery room space, located in or owned by any hospital investor, unless such space is leased from the hospital in accordance with a lease that complies with all the standards of the space rental safe harbor set forth in paragraph (b) of this section; nor may it use equipment owned by or services provided … Fair market value is one of the most important aspects of the foregoing exceptions. Anti-Kickback Statute 42 US Code Section 1320a-7b(b) According to the Anti-Kickback Statute 42 US Code Section 1320A-7B(B), it is prohibited to knowingly and willfully offer, solicit, pay, or receive anything of value which create any type of reward for referring patients to, recommending or arranging any type of purchase that falls under the payment made by health care benefit … The safe harbor regulations in the Anti-Kickback Statute focus on payments and business activities identified as lawful inducement of payments by Medicare or Medicaid programs. There cannot be multiple overlapping contracts to circumvent the one-year rule. However, the OIG interprets the “set in advance” requirement to mean that the total aggregate compensation to be paid over the term of the contract must be determined at the outset of the arrangement. The federal anti-kickback statute created criminal penalties for knowingly and willfully paying for business referrals for services covered by any federal healthcare program. The U.S. Department of Health and Human Services (HHS) adopted certain regulatory leasing safe harbors for both the Anti-Kickback Statute, commonly referred to as the “space rental safe harbor,” and Stark Law, commonly referred to as the “office space rental … Patient Engagement Tools and Supports: Analysis of the New Anti-Kickback Statute Regulatory Safe Harbor PDF Share . • Not required to fit within safe harbor because ultimate question is whether “one purpose” of remuneration is to induce or reward referrals. HHS has defined “fair market value” as the value in an arm’s length transaction, consistent with the general market value, including charging physician tenants for all of the space that they use, including their pro rata portion of all common areas. Thus, compensation arrangements based on an hourly rate, where the hours of service can vary, will not qualify for safe harbor protection. See 42 C.F.R. •To be protected, an arrangement must fit squarely in the safe harbor and satisfy all of its requirements. signed. One such AKS safe harbor is for personal services and management contracts. Anti-Kickback Statute (AKS) •Safe harbors protect certain payment and business practices that could otherwise implicate the AKS from criminal and civil prosecution. -This rule is intended to prevent a disguised kickback that could occur if an otherwise legitimate payment for the provision of goods or services were adjusted periodically to reward a party for referring patients or generating other federal healthcare program business. Commercial Leasing: Understanding the Business Deal Webinar Recording, States Enact Statutes that Protect Landlords from COVID-19 Premises Liability Claims, Update on Texas Foreclosures Given Statewide Rise in COVID-19 Cases, Part 1: Healthcare Leases: Anti-Kickback Statute and Stark Law. In its original 1972 form, the AKS specifically targeted “kickbacks or bribes” and “rebates.” In 1977, Congress expanded the statute’s scope by prohibiting “any remuneration” exchanged for purchasing or referring federally funded goods or services.In the decades since the 1977 expansion, Congress has, from time to time, added “safe harbor” provisions to the AKS to ensure that providers do not face criminal liability for beneficial or innocuous types of remunerations.In … covered by the lease • The term of the lease is for not less than . APPLICATION OF THE ANTI-KICKBACK STATUTE DISCOUNT SAFE HARBOR TO BUNDLED SALES. Purchases of Equipment, Consumables, and Data Access made under Sofia (and Virena) Agreements (the “Agreement”) constitute a bundled sale arrangement, whereby the receipt of goods and services at reduced or no charge is conditioned upon the purchase of other goods … The safe harbor regulations, in … “General market value” has been defined as the rate that would result from bona fide bargaining between well-informed parties who are not otherwise in a position to generate business for the other party on the date of the agreement. © 2021 Berger Montague All Rights Reserved, Remuneration Under the Anti-Kickback Statute Includes Intangible Economic Benefits, The Anti-Kickback Statute vs. In order to move forward with a referral source lease, there must be no intent to induce referrals and the leasing arrangement should be structure to meet most, if not all, of the elements of an applicable AKS safe harbor. • The closer you come to satisfying regulatory requirements, the safer you will be. 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