-
1
-
-
0345054090
-
-
56 Fed. Reg. 35,952, 35,978 (July 29, 1991) (comments of DHHS, Office of inspector General (OIG) regarding discounting practices)
-
56 Fed. Reg. 35,952, 35,978 (July 29, 1991) (comments of DHHS, Office of inspector General (OIG) regarding discounting practices).
-
-
-
-
2
-
-
0344191827
-
-
note
-
Remark from a frustrated drug company employee after attending a seminar on the Medicare antikickback law.
-
-
-
-
3
-
-
0345054088
-
-
note
-
Pub. L. No. 92-603, 86 Stat. 1419 (1972) (codified as amended 42 U.S.C. § 1320a-7b(b) (1994)). The antikickback statute amends the Social Security Act (SSA), Ch. 531, 49 Stat. 620 (1935) (codified as amended 42 U.S.C. §§ 300 et seq.). The antikickback statute also applies to state programs funded under Titles V (Maternal and Child Health), XIX (Medicaid), and XX (Social Services Block Grants) of the Social Security Act, and (as of January 1, 1997) to all federal health care programs other than the Federal Employees Health Benefits Plan. See Health Insurance Portability and Accountability Act of 1996 (HIPAA), Pub. L. No. 104-191. § 204, 110 Stat. 1936, 1999 (amending 42 U.S.C § 1320a-7b (SSA § 1128B)). The term federal health care program means "any plan or program that provides health benefits, whether directly, through insurance, or otherwise, which is funded directly, in whole or in part, by the United States Government [other than the Federal Employees Health Benefits Plan]," 42 U.S.C. § 1320a-7b(f) (SSA § 1128B(f)), and any federally funded state health care program. For the ease of readers and because the principal programs likely to be affected will remain Medicare and Medicaid, the traditional Medicare/Medicaid nomenclature is used throughout this article. Future references to "Medicare and Medicaid" generally should be read to include these other federally-funded health care programs.
-
-
-
-
4
-
-
0344191800
-
-
note
-
This article will not address the potential for manufacturer liability under other federal authorities that prohibit health care "fraud and abuse," such as the crime of "health care fraud" created by HIPAA § 241 or the so-called "tark law" prohibition on physician self-referral. 42 U.S.C. § 1395nn (SSA § 1877). HIPAA creates new liabilities for any "scheme or artifice" to defraud, or obtain money by false pretenses from, a health plan (federal or not); it is potentially relevant in numerous circumstances, but perhaps most especially where payment arrangements are hidden from plans. Although the Stark law is not clear on its face, there is a good argument that it should not be read to apply to financial relationships between physicians and drug or device manufacturers who simply sell products for inventory to physicians. In a proposed regulation published in early 1998 to implement the Stark law, the Health Care Financing Administration (HCFA) appeared to take a contrary view, suggesting that manufacturer sales to physicians are "financial relationships" subject to regulation under the Stark law. See 63 Fed. Reg. 1659, 1694 (Jan. 9, 1998). HCFA officials, however, subsequently made public statements to clarify that the agency had not intended to imply that manufacturer-physician relations would be subject to Stark, See, e.g., Letter from Nancy-Ann Min DeParle, HCFA Adm'r, to Rep. Bill Thomas (R-CA), Apr. 20, 1998 ("the compensation relationship between the physician and the drug manufacturer is irrelevant [under Stark] . . . because there is no referral to the drug manufacturer [when the physician purchases drugs and provides them to patients]; instead, the physician is referring to himself."). The article also will not address the potential for manufacturer liability under the federal civil False Claims Act (FCA), Pub. L. No. 97-258, 96 Stat. 978 (1982) (codified at 31 U.S.C. §§ 3729 et seq. (1994)), which permits the government to recover damages and penalties in a civil judicial proceeding if the government proves that a defendant knowingly presented or caused to be presented a false or fraudulent claim for payment or approval, 31 U.S.C. § 3729(a)(1). Some courts have accepted the theory of some prosecutors that a claim for services provided pursuant to an unlawful referral (e.g., a referral resulting from an unlawful kickback) runs afoul of the FCA because all such services by definition are false, fraudulent, or for a service not provided as claimed. See infra note 7, While drug and device manufacturers ordinarily do not "present" Medicare or Medicaid claims for payment, it is conceivable that the government could seek to hold a manufacturer liable for "causing" a claim to be presented on behalf of a customer for whom the manufacturer provided billing services or reimbursement advice. The act also allows private persons to bring qui tam suits in the name of the government under certain circumstances, thus raising the potential for suits instituted by competitors or disgruntled employees. See 31 U.S.C. § 3730.
-
-
-
-
5
-
-
24544448206
-
-
§ 3
-
42 U.S.C. § 1320a-7b(b) (SSA § 1128B(b)). Many states have enacted substantially similar antikickback laws that apply regardless of whether federal payment is involved. See, e.g.. MASS. GEN. LAWS ch. 175H, § 3 (1999); MICH. COMP. LAWS § 752,1004 (1999); MINN. STAT. § 621.23 (Supp. 1999); R.I. GEN. LAWS § 40-8,2-3 (1990). This article generally will discuss only the federal law, although state officials could apply federal law principles in interpreting state antikickback laws.
-
(1999)
Mass. Gen. Laws Ch.
-
-
-
6
-
-
0039501017
-
-
§ 752,1004
-
42 U.S.C. § 1320a-7b(b) (SSA § 1128B(b)). Many states have enacted substantially similar antikickback laws that apply regardless of whether federal payment is involved. See, e.g.. MASS. GEN. LAWS ch. 175H, § 3 (1999); MICH. COMP. LAWS § 752,1004 (1999); MINN. STAT. § 621.23 (Supp. 1999); R.I. GEN. LAWS § 40-8,2-3 (1990). This article generally will discuss only the federal law, although state officials could apply federal law principles in interpreting state antikickback laws.
-
(1999)
Mich. Comp. Laws
-
-
-
7
-
-
0345485748
-
-
§ 621.23
-
42 U.S.C. § 1320a-7b(b) (SSA § 1128B(b)). Many states have enacted substantially similar antikickback laws that apply regardless of whether federal payment is involved. See, e.g.. MASS. GEN. LAWS ch. 175H, § 3 (1999); MICH. COMP. LAWS § 752,1004 (1999); MINN. STAT. § 621.23 (Supp. 1999); R.I. GEN. LAWS § 40-8,2-3 (1990). This article generally will discuss only the federal law, although state officials could apply federal law principles in interpreting state antikickback laws.
-
(1999)
Minn. Stat.
, Issue.SUPPL.
-
-
-
8
-
-
0345485746
-
-
§ 40-8,2-3 This article generally will discuss only the federal law, although state officials could apply federal law principles in interpreting state antikickback laws
-
42 U.S.C. § 1320a-7b(b) (SSA § 1128B(b)). Many states have enacted substantially similar antikickback laws that apply regardless of whether federal payment is involved. See, e.g.. MASS. GEN. LAWS ch. 175H, § 3 (1999); MICH. COMP. LAWS § 752,1004 (1999); MINN. STAT. § 621.23 (Supp. 1999); R.I. GEN. LAWS § 40-8,2-3 (1990). This article generally will discuss only the federal law, although state officials could apply federal law principles in interpreting state antikickback laws.
-
(1990)
R.I. Gen. Laws
-
-
-
9
-
-
0345485749
-
-
42 U.S.C. § 1320a-7b(b)
-
42 U.S.C. § 1320a-7b(b).
-
-
-
-
10
-
-
0344191820
-
-
note
-
In addition, in some jurisdictions a violation of the antikickback statute may provide grounds for suit by the government or a qui tam relator under the FCA. See, e.g., United States v. Kensington Hosp., 760 F. Supp. 1120 (E.D. Pa, 1991); United States ex rel. Roy v. Anthony, 914 F. Supp. 1504 (S.D. Ohio 1994); United States ex rel. Pogue v. American Healthcorp, Inc., 914 F. Supp. 1507 (M.D. Tenn. 1996). The only federal court of appeals to have addressed the issue heid that while a mere violation of antikickback law does not create a basis for suit under the FCA, such basis may exist where defendant certifies compliance with the law in a filing and payment is conditioned on such certification. United States ex rel. Thompson v. Columbia/HCA Healthcare Corp., 125 F.3d 899 (5th Cir. 1997). On remand, the district court denied the defendant's motion to dismiss and allowed the suit to proceed. United States ex rel. Thompson v. Columbia/HCA Healthcare Corp., 1998 U.S. Dist. LEXIS 14350 (No. C-95-110, S.D. Tex., Aug. 18, 1998).
-
-
-
-
11
-
-
0344623553
-
-
56 Fed. Reg. at 35,954 (quoting United States v. Ruttenberg, 625 F.2d 173, 177, n.9 (7th Cir. 1980))
-
56 Fed. Reg. at 35,954 (quoting United States v. Ruttenberg, 625 F.2d 173, 177, n.9 (7th Cir. 1980)).
-
-
-
-
12
-
-
0344623549
-
-
note
-
United States v. Greber, 760 F.2d 68, 72 (3d Cir.), cert. denied, 474 U.S. 988 (1985) ("If the payments were intended to induce the physician to use [defendant's] services, the statute was violated, even if the payments were also intended to compensate for professional services"); United States v, Bay State Ambulance & Hosp. Rental Serv., Inc., 874 F.2d 20, 30 (1st Cir. 1989) (noting that the "issue of the sole versus primary reason for payments is irrelevant since any amount of inducement is illegal," but approving a jury instruction that prohibited conviction if the improper purpose was "incidental" or "minor"); United States v. Kats, 871 F.2d 105, 108 (9th Cir. 1989) (approving jury instruction that guilt could be found "if you find beyond a reasonable doubt that one of the material purposes for the solicitation was to obtain money for the referral of services") (emphasis in original).
-
-
-
-
13
-
-
0344623534
-
-
Inspector Gen. v. Hanlester Network, Dec. No. 1275 (DHHS Dep't App. Bd., App. Div., Sept. 19, 1991) at 57 & n.34, reprinted in [1992-1 Transfer Binder] (CCH) ¶ 39,566 n.34, on remand, Doc. C-448, Dec. No. CR 181 DHHS Dep't App. Bd., Civ. Remedies Div., Mar. 10
-
Inspector Gen. v. Hanlester Network, Dec. No. 1275 (DHHS Dep't App. Bd., App. Div., Sept. 19, 1991) at 57 & n.34, reprinted in [1992-1 Transfer Binder] Medicare &. Medicaid Guide (CCH) ¶ 39,566 at 27,763 & n.34, on remand, Doc. C-448, Dec. No. CR 181 (DHHS Dep't App. Bd., Civ. Remedies Div., Mar. 10, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 40,064, aff'd in part and rev'd in part, Dec. No. 1347 (DHHS Dep't App. Bd., App. Div., July 24, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) at ¶ 40,406B, aff'd sub nom, Hanlester Network v. Sullivan, No. CV 92-4552-LHM, 1993 WL 78299 (C.D. Cal. Feb. 10, 1993), reprinted in [1993-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 41,076, aff'd in part and rev'd in part sub nom. Hanlester Network v. Shalala, 51 F.3d 1390 (9th Cir. 1995).
-
(1992)
Medicare &. Medicaid Guide
, pp. 27763
-
-
-
14
-
-
0344623534
-
-
reprinted in [1992-2 Transfer Binder] (CCH) ¶ 40,064, aff'd in part and rev'd in part, Dec. No. 1347 DHHS Dep't App. Bd., App. Div., July 24
-
Inspector Gen. v. Hanlester Network, Dec. No. 1275 (DHHS Dep't App. Bd., App. Div., Sept. 19, 1991) at 57 & n.34, reprinted in [1992-1 Transfer Binder] Medicare &. Medicaid Guide (CCH) ¶ 39,566 at 27,763 & n.34, on remand, Doc. C-448, Dec. No. CR 181 (DHHS Dep't App. Bd., Civ. Remedies Div., Mar. 10, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 40,064, aff'd in part and rev'd in part, Dec. No. 1347 (DHHS Dep't App. Bd., App. Div., July 24, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) at ¶ 40,406B, aff'd sub nom, Hanlester Network v. Sullivan, No. CV 92-4552-LHM, 1993 WL 78299 (C.D. Cal. Feb. 10, 1993), reprinted in [1993-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 41,076, aff'd in part and rev'd in part sub nom. Hanlester Network v. Shalala, 51 F.3d 1390 (9th Cir. 1995).
-
(1992)
Medicare & Medicaid Guide
-
-
-
15
-
-
0345485744
-
-
reprinted in [1992-2 Transfer Binder] (CCH) at ¶ 40,406B, aff'd sub nom, Hanlester Network v. Sullivan, No. CV 92-4552-LHM, 1993 WL 78299 C.D. Cal. Feb. 10
-
Inspector Gen. v. Hanlester Network, Dec. No. 1275 (DHHS Dep't App. Bd., App. Div., Sept. 19, 1991) at 57 & n.34, reprinted in [1992-1 Transfer Binder] Medicare &. Medicaid Guide (CCH) ¶ 39,566 at 27,763 & n.34, on remand, Doc. C-448, Dec. No. CR 181 (DHHS Dep't App. Bd., Civ. Remedies Div., Mar. 10, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 40,064, aff'd in part and rev'd in part, Dec. No. 1347 (DHHS Dep't App. Bd., App. Div., July 24, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) at ¶ 40,406B, aff'd sub nom, Hanlester Network v. Sullivan, No. CV 92-4552-LHM, 1993 WL 78299 (C.D. Cal. Feb. 10, 1993), reprinted in [1993-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 41,076, aff'd in part and rev'd in part sub nom. Hanlester Network v. Shalala, 51 F.3d 1390 (9th Cir. 1995).
-
(1993)
Medicare & Medicaid Guide
-
-
-
16
-
-
0004826315
-
-
reprinted in [1993-1 Transfer Binder] (CCH) ¶ 41,076, aff'd in part and rev'd in part sub nom. Hanlester Network v. Shalala, 51 F.3d 1390 9th Cir.
-
Inspector Gen. v. Hanlester Network, Dec. No. 1275 (DHHS Dep't App. Bd., App. Div., Sept. 19, 1991) at 57 & n.34, reprinted in [1992-1 Transfer Binder] Medicare &. Medicaid Guide (CCH) ¶ 39,566 at 27,763 & n.34, on remand, Doc. C-448, Dec. No. CR 181 (DHHS Dep't App. Bd., Civ. Remedies Div., Mar. 10, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 40,064, aff'd in part and rev'd in part, Dec. No. 1347 (DHHS Dep't App. Bd., App. Div., July 24, 1992), reprinted in [1992-2 Transfer Binder] Medicare & Medicaid Guide (CCH) at ¶ 40,406B, aff'd sub nom, Hanlester Network v. Sullivan, No. CV 92-4552-LHM, 1993 WL 78299 (C.D. Cal. Feb. 10, 1993), reprinted in [1993-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 41,076, aff'd in part and rev'd in part sub nom. Hanlester Network v. Shalala, 51 F.3d 1390 (9th Cir. 1995).
-
(1995)
Medicare & Medicaid Guide
-
-
-
17
-
-
0344623532
-
-
Hanlester, Transfer Binder (CCH) ¶ 39,566 United States v. Lipkis, 740 F.2d 1447, 1449 (9th Cir. 1985); Bay State, 874 F.2d at 29
-
Hanlester, [1992-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 39,566 at 27,762-63; United States v. Lipkis, 740 F.2d 1447, 1449 (9th Cir. 1985); Bay State, 874 F.2d at 29.
-
(1992)
Medicare & Medicaid Guide
, pp. 27762-27763
-
-
-
18
-
-
0344623534
-
-
Hanlester, Transfer Binder (CCH) ¶ 39,566
-
Hanlester, [1992-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 39,566 at 27,740, 27,748, 27,759, 27,763.
-
(1992)
Medicare & Medicaid Guide
, pp. 27740
-
-
-
19
-
-
0344623534
-
-
Ruttenberg, 625 F.2d at 177; Hanlester Transfer Binder (CCH) ¶ 39,566
-
Ruttenberg, 625 F.2d at 177; Hanlester [1992-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 39,566 at 27,763.
-
(1992)
Medicare & Medicaid Guide
, pp. 27763
-
-
-
20
-
-
0344623534
-
-
Hanlester, Transfer Binder (CCH) ¶ 39,566
-
Hanlester, [1992-1 Transfer Binder] Medicare & Medicaid Guide (CCH) ¶ 39,566 at 27,763. In 1995. the U.S. Court of Appeals for the Ninth Circuit held that a violation of the antikickback law cannot be found absent a showing that the defendant: (1) knew that the law prohibited giving or receiving remuneration for referrals; and (2) acted with a specific intent to violate the law. See Hanlester, 5 F.3d at 1400. Several courts in other jurisdictions, however, have declined to follow this approach. See, e.g., United States v. Starks, 157 F.3d 833, 839 (11th Cir. 1998) (finding that antikickback statute is not a highly technical regulation "that poses a danger of ensnaring persons engaged in apparently innocent conduct"); United States v. Jain, 93 F.3d 436, 440-41 (8th Cir. 1996) (distinguishing Hanlester as an administrative debarment proceeding and rejecting application of the main case on which the Hanlester court relied); United States v. Neufeld, 908 F. Supp. 491, 497 (S.D. Ohio 1995) (declining to follow Hanlester); Medical Dev. Network, Inc. v. Professional Respiratory Care/ Home Med. Equip. Serv. Inc., 673 So.2d 565, 567 (Fla. Dist. Ct. App. 1996) (the statute "is directed at punishment of those who perform sped fie acts and does not require that one engage in the prohibited conduct with the specific intent to violate the statute"), Cf. United States v. Davis, 132 F.3d 1092, 1094 (5th Cir. 1998) ("even the Hanlester court requires knowledge only that the conduct in question was unlawful, and not necessarily knowledge of which particular statute makes the conduct unlawful").
-
(1992)
Medicare & Medicaid Guide
, pp. 27763
-
-
-
21
-
-
0041543660
-
-
§ 2B4.1 (sentencing calculations for violation of antikickback law)
-
The civil monetary penalty authority was added by section 4304 of the Balanced Budget Act of 1997, Pub. L. No. 105-33, 111 Stat. 251 (codified at 42 U.S.C. § 1320a-7a(a)(7) (SSA § 1128A(a)(7)). The antikickback law's stated criminal fine - $25,000 per violation - essentially has been rendered obsolete by the more stringent penalty provisions of the Federal sentencing law. See 18 U.S.C § 3571 (1994) (imposing criminal fines of $250,000 for individuals or $500,000 for organizations per violation, or twice the gain to the defendant or loss to another as a result of the illegal conduct); U.S. SENTENCING GUIDELINES MAN. § 2B4.1 (1998) (sentencing calculations for violation of antikickback law).
-
(1998)
U.S. Sentencing Guidelines Man
-
-
-
22
-
-
0344191797
-
-
note
-
42 U.S.C. §§ 1320a-7(b)(7), 1320a-7a(a)(7), 1320a-7b(b)(SSA §§ 1128(b)(7), 1128B(a)(7), 1128B(b)) (imposing civil exclusion or civil money penalty of up to $50,000 per act plus three times the remuneration in administrative proceeding, or criminal prosecution with potential fines and prison time of up to five years); 42 C.F.R. §§ 1001.101, 1001.951 (civil exclusion) (1999). HIPPA also added a related civil monetary penalty for offering remuneration to individuals enrolled in Medicare or a state health care program that the person offering knows or should know is likely to influence the individual to order or receive items or services from a particular provider, practitioner, or supplier, 42 U.S.C. § 1320a-7a(a)(5) (SSA § 1128A(a)(5)). Although the term "supplier" is not defined, this authority conceivably could be applied to manufacturers that offer patient coupons or other benefits.
-
-
-
-
23
-
-
0027128522
-
-
See 57 Fed. Reg. 3298, 3300 (Jan. 29, 1992)
-
See 57 Fed. Reg. 3298, 3300 (Jan. 29, 1992).
-
-
-
-
24
-
-
0345054064
-
-
note
-
See 63 Fed. Reg. 46,676 (Sept. 2, 1998). The OIG has indicated specifically that it intends this authority to apply to manufacturers and distributors. Id. at 46,678; 62 Fed. Reg. 47,182, 47,184-85 (Sept. 8, 1997) (NPRM). Because the relevant statutory provisions speak to exclusion of individuals or entities "from participation" in the Medicare and Medicaid programs, it is not clear that the statute gives the OIG the authority to make this change. Moreover, a host of practical considerations, arising out of the different roles played by manufacturers and providers in the health care delivery system - including the potential for beneficiaries to be denied Medicare or Medicaid coverage of drugs or devices for which no therapeutic equivalent exists - led many manufacturers to argue against implementation of this policy change.
-
-
-
-
25
-
-
0344623525
-
-
See, e.g., Polk County v. Peters, 800 F, Supp. 1451 (E.D. Tex. 1992) (citing Hospital Fraud Alert in declaring void a contract under which a physician agreed to refer patients to a hospital as part of a recruitment package)
-
See, e.g., Polk County v. Peters, 800 F, Supp. 1451 (E.D. Tex. 1992) (citing Hospital Fraud Alert in declaring void a contract under which a physician agreed to refer patients to a hospital as part of a recruitment package).
-
-
-
-
26
-
-
0345485725
-
-
note
-
Issued August 1994, reprinted at 59 Fed. Reg. 65,372, 65,376 (Dec. 19, 1994). Special Fraud Alerts must be distinguished from internal OIG "fraud alerts," which are used as an internal means to share information among investigators in the agency. Unlike Special Fraud Alerts, which are available publicly from a variety of sources, internal fraud alerts are available to the public only by making a request under the Freedom of Information Act. Pub. L. No. 89-487, 80 Stat. 250 (1966) (as amended 5 U.S.C. § 552 (1994)); 42 C.F.R. § 401.116.
-
-
-
-
27
-
-
0344623526
-
-
59 Fed. Reg. at 65,376
-
59 Fed. Reg. at 65,376.
-
-
-
-
28
-
-
0345485724
-
-
Id.
-
Id.
-
-
-
-
29
-
-
0344623524
-
-
Each of these programs corresponds to a specific investigation and settlement agreement discussed later in this article. See infra notes 97-99 and accompanying text
-
Each of these programs corresponds to a specific investigation and settlement agreement discussed later in this article. See infra notes 97-99 and accompanying text.
-
-
-
-
30
-
-
0344191793
-
-
59 Fed. Reg. at 65,376
-
59 Fed. Reg. at 65,376.
-
-
-
-
31
-
-
0345054059
-
-
Issued May 1992, reprinted at 59 Fed. Reg. at 65,375
-
Issued May 1992, reprinted at 59 Fed. Reg. at 65,375.
-
-
-
-
32
-
-
0345485719
-
-
Id. at 65,376
-
Id. at 65,376.
-
-
-
-
33
-
-
0344623521
-
-
Issued October 1994, reprinted at 59 Fed. Reg. at 65,377
-
Issued October 1994, reprinted at 59 Fed. Reg. at 65,377.
-
-
-
-
34
-
-
0345485716
-
-
Nov. 23
-
Id. at 65,376. In this regard, it may be worth noting that the American Medical Association (AMA) has taken the position that because it generally is considered unethical for physicians to treat themselves or their families (exceptin emergency situations), it likewise is unethical for physicians to accept from manufacturers free products for their own use or the use of their families, See Am. Med. Ass'n, New Clarification by the Council on Ethical and Judicial Affairs of Guideline 1 from Gifts to Physicians from Industry, Nov. 23, 1993.
-
(1993)
Am. Med. Ass'n, New Clarification by the Council on Ethical and Judicial Affairs of Guideline 1 from Gifts to Physicians from Industry
-
-
-
35
-
-
0344191786
-
-
Medicare & Medicaid Patient and Program Protection Act of 1987, Pub. L. No. 100-93, § 14, 101 Stat. 697-698
-
Medicare & Medicaid Patient and Program Protection Act of 1987, Pub. L. No. 100-93, § 14, 101 Stat. 697-698.
-
-
-
-
36
-
-
0345054048
-
-
See 56 Fed. Reg. 35,952 (July 29, 1991) (codified at 42 C.F.R. § 1001.952). Amendments to some of the safe harbor provisions were proposed in September 1993 and July 1994, but have not been finalized. See 58 Fed. Reg. 49,008 (Sept. 21, 1993), 59 Fed. Reg. 37,202 (July 21, 1994)
-
See 56 Fed. Reg. 35,952 (July 29, 1991) (codified at 42 C.F.R. § 1001.952). Amendments to some of the safe harbor provisions were proposed in September 1993 and July 1994, but have not been finalized. See 58 Fed. Reg. 49,008 (Sept. 21, 1993), 59 Fed. Reg. 37,202 (July 21, 1994).
-
-
-
-
37
-
-
0344623513
-
-
54 Fed. Reg. 3088, 3089 (Jan. 23, 1989); 56 Fed. Reg. at 35,954
-
54 Fed. Reg. 3088, 3089 (Jan. 23, 1989); 56 Fed. Reg. at 35,954.
-
-
-
-
38
-
-
0345054047
-
-
See supra note 8 and accompanying text
-
See supra note 8 and accompanying text.
-
-
-
-
39
-
-
0344191778
-
-
56 Fed. Reg. at 35,956, 35,978
-
56 Fed. Reg. at 35,956, 35,978,
-
-
-
-
40
-
-
0344191777
-
-
note
-
As noted supra note 9, the anti-kickback law is violated if even one purpose (as opposed to a primary or sole purpose) of a payment is in exchange for or to induce referred, or the order, purchasing, or recommending of items and services. See, e.g., Greber, 760 F.2d at 72.
-
-
-
-
41
-
-
0344623507
-
-
note
-
42 U.S.C § 1320a-7b(b)(3)(SSA § 1128B(b)(3)). Exceptions for these payments are needed because percentage sales commissions to employees, the financial benefits entailed by price reductions on purchased products, and fees to group purchasing organizations all can be viewed as "remuneration" intended to induce the recipient to purchase or to recommend or arrange for purchases. See infra notes 58-64 and accompanying text.
-
-
-
-
42
-
-
0345485705
-
-
note
-
See 56 Fed. Reg. at 35,956-57. Thus, where there is an overlap, the OIG has maintained that the scope of the statutory exemptions is defined by the safe harbor provisions. See, e.g., 59 Fed. Reg. at 37,206 (all discounts that Congress intended to protect under the statute are protected under the discount safe harbor).
-
-
-
-
43
-
-
0344623505
-
-
note
-
42 U.S.C. § 1320a-7b(b)(3) (SSA § 1128B(b)(3)); 42 C.F.R. § 1001.952(h). In July 1994, OIG proposed to rewrite the discount safe harbor See 59 Fed. Reg. at 37,205-06. The proposed amendments would strengthen the requirements imposed on buyers and sellers, and create obligations for a new class of entities described as "offerors" of discounts that are neither buyers nor sellers. To date, this rule has not been finalized.
-
-
-
-
44
-
-
0344191776
-
-
42 U.S.C. § 1320a-7b(b)(3)(A)(SSA § 1128B(b)(3)(A))
-
42 U.S.C. § 1320a-7b(b)(3)(A)(SSA § 1128B(b)(3)(A)).
-
-
-
-
45
-
-
0345054041
-
-
note
-
42 C.F.R. § 1001.952(h). The regulations can be summarized as follows: Buyers that file cost reports (e.g., hospitals and nursing homes) must satisfy the following four requirements: (1) the discount must be earned on purchases of the same good or service bought within a single fiscal year of the buyer; (2) buyer must claim the benefit of the discount in the fiscal year earned or the immediately following year; (3) buyer must fully and accurately report the discount in the applicable cost report; and (4) buyer must provide, on request by Medicare or Medicaid officials, information provided by the seller with respect to the discount. Buyers that are health maintenance organizations (HMOs) or competitive medical plans (CMPs) (under [SSA] §§ 1876(g) or 1903(m)) need not report discounts unless required to do so under their risk contracts. All other buyers (e.g., physicians) must satisfy the following requirements: (1) the discount must be made at the time of the original sale of the good or service; (2) where the good or service is claimed separately for payment under Medicare or Medicaid, the buyer must fully and accurately report the discount on the claim; and (3) buyer must provide, on request by Medicare and Medicaid officials, information furnished by the seller with respect to the discount. Where the buyer is a qualifying HMO or CMP, the seller need not report the discount to the buyer. Where the buyer is an entity that files a cost report, the seller must comply with one of the following standards; (1) where the discount is known at the time of sale, the seller must fully and accurately report the discount on the invoice or statement submitted to the buyer, and inform the buyer of its obligations to report the discount; or (2) where the value of the discount is not known at the time of sale (as in the case of a year-end discount) the seller must fully and accurately report the existence of a discount program on the invoice or statement, [and] when the value of the discount becomes known, provide the buyer with documentation of the calculation of the discount, identifying the specific goods or services purchased to which the discount will be applied, and inform the buyer of its obligations to report the discount. Where the buyer is any other individual or entity and the item or service discounted is not separately claimed for payment, the seller need not report the discount to the buyer. If the item or service is separately claimed for payment, the seller must: fully and accurately report the discount on the invoice or statement submitted to the buyer, and inform the buyer of its obligations to report the discount. See id.
-
-
-
-
46
-
-
0345485704
-
-
42 U.S.C. § 1320a-7b(b)(3)(B) (SSA § 1128(b)(3)(B)); 42 C.F.R.. § 1001.952(i). While implicated by many types of payments to employees, this safe harbor is of special importance for percentage commission sales arrangements, See infra parts III.D and IV.C.7
-
42 U.S.C. § 1320a-7b(b)(3)(B) (SSA § 1128(b)(3)(B)); 42 C.F.R.. § 1001.952(i). While implicated by many types of payments to employees, this safe harbor is of special importance for percentage commission sales arrangements, See infra parts III.D and IV.C.7.
-
-
-
-
47
-
-
0345054039
-
-
note
-
The Chief Counsel to the OIG has suggested that in some circumstances the bona fide employment safe harbor may be interpreted more narrowly than its language suggests. In a 1992 letter to the IRS, the Chief Counsel noted that the statutory exception applies only to payments to employees that are for employment in "the provision of covered items or services." Letter from D. McCarty Thornton, Chief Counsel, OIG, to T.J. Sullivan, Tech. Assistant (Health Care Indus.), Off. of the Assoc. Chief Counsel (Employee Benefits and Exempt Organizations), IRS, Dec. 22, 1992. The Chief Counsel's letter notes that "payments to employees which are for the purpose of compensating such employees for the referral of patients would likely not be covered by the employee exemption." Id. n.2. In addition, a proposed, but not yet finalized, rule that would allow the OIG to challenge "sham transactions" suggests that the OIG could challenge even a bona fide employment relationship if it were "entered into or employed for the purpose of appearing to fit within a safe harbor when the substance of the transaction or device is not accurately reflected by the form." See 59 Fed. Reg. 37,202, 37,208 (July 21, 1994). To date, the OIG or the Department of Justice have not applied this interpretation of the employee exemption.
-
-
-
-
48
-
-
0345054035
-
-
42 U.S.C. § 1320a-7b(b)(3)(C); 42 C.F.R. § 1001.952(j)
-
42 U.S.C. § 1320a-7b(b)(3)(C); 42 C.F.R. § 1001.952(j).
-
-
-
-
49
-
-
0345054036
-
-
42 U.S.C. § 1320a-7b(b)(3)(C)
-
42 U.S.C. § 1320a-7b(b)(3)(C).
-
-
-
-
50
-
-
0344191773
-
-
The term "provider of services" also includes critical access hospitals and comprehensive outpatient rehabilitation facilities. 42 U.S.C. § 1395x(u)(SSA § 1861(u))
-
The term "provider of services" also includes critical access hospitals and comprehensive outpatient rehabilitation facilities. 42 U.S.C. § 1395x(u)(SSA § 1861(u)).
-
-
-
-
51
-
-
0345054037
-
-
Id. § 1320a-7b(b)(3)(C)
-
Id. § 1320a-7b(b)(3)(C).
-
-
-
-
52
-
-
0344191772
-
-
Pub. L. No. 104-191, § 216(a) (codified at 42 U.S.C. § 1320a-7b(b)(3)(F) (SSA § 1128B(b)(3)(F)))
-
Pub. L. No. 104-191, § 216(a) (codified at 42 U.S.C. § 1320a-7b(b)(3)(F) (SSA § 1128B(b)(3)(F))).
-
-
-
-
53
-
-
0344191769
-
-
Id.
-
Id.
-
-
-
-
54
-
-
0344191761
-
Government Presents "Big Picture" Plan for Managed Care/Anti-kickback Policy
-
Dec. 5 Industry still awaits release of the proposed rule
-
Id. § 216(b). Representatives from major manufacturer trade associations, including the Pharmaceutical Research and Manufacturers of America (PhRMA) and the Health Industry Manufacturers Association (HIMA), participated in the negotiation process, which formally concluded in 1998. See generally Government Presents "Big Picture" Plan for Managed Care/Anti-kickback Policy, BNA's Medicare Rep., Dec. 5 1997, at 1164. Industry still awaits release of the proposed rule.
-
(1997)
BNA's Medicare Rep.
, pp. 1164
-
-
-
55
-
-
0344623499
-
-
42 C.F.R. § 1001.952(d)
-
42 C.F.R. § 1001.952(d).
-
-
-
-
56
-
-
0345485700
-
-
note
-
Safe harbor amendments proposed in July 1994 also would require the agreement to cover all services that the agent provides to the principal for the period of the agreement, and would require that the aggregate services not exceed those that reasonably are necessary to accomplish the legitimate business purpose of the services. See 59 Fed. Reg. at 37,205, 37,207. To date, these proposed changes have not been finalized.
-
-
-
-
57
-
-
0344191768
-
-
See 56 Fed. Reg. at 35,972 (laboratory's lease of space from physician, which laboratory does not use, is a disguised kickback)
-
See 56 Fed. Reg. at 35,972 (laboratory's lease of space from physician, which laboratory does not use, is a disguised kickback).
-
-
-
-
58
-
-
0344623498
-
-
42 C.F.R. §§ 1001.952(b), (c)
-
42 C.F.R. §§ 1001.952(b), (c).
-
-
-
-
59
-
-
0344191759
-
-
Id. § 1001.952(d)
-
Id. § 1001.952(d).
-
-
-
-
60
-
-
0345054026
-
-
note
-
Pub. L. No. 104-191, § 205 (adding 42 U.S.C. § 1320a-7d(b)(SSA § 1128D(b)). The OIG has issued a final rule addressing the advisory opinion process, 63 Fed. Reg. 38,311 (July 16, 1998). The rule addresses only the procedures involved in obtaining advisory opinions, however, and does not address "the substance or content of advisory opinions which may be issued in the future." Id. at 38,322.
-
-
-
-
61
-
-
0031577951
-
-
See 62 Fed. Reg. 7350 (Feb. 19, 1997) (codified at 42 C.F.R. pt. 1008)
-
See 62 Fed. Reg. 7350 (Feb. 19, 1997) (codified at 42 C.F.R. pt. 1008).
-
-
-
-
62
-
-
0345054020
-
-
42 C.F.R. § 1008.36
-
42 C.F.R. § 1008.36.
-
-
-
-
63
-
-
0344191752
-
-
note
-
For example, the first two advisory opinions, issued in June and July 1997, approved charity care programs that received contributions from companies that might benefit from referrals. The fourth advisory opinion, issued in September 1997, indirectly addressed a charity care issue, but concluded that a waiver of coinsurance program by an ambulatory surgical center that was not limited to cases of demonstrable financial need created risks under the antikickback law. The fifth advisory opinion, issued in October 1997, approved a radiologist-hospital joint venture to operate a radiology center where it was clear that neither the radiologists nor hospital physicians would be a significant source of referrals to the center.
-
-
-
-
64
-
-
0344623477
-
-
note
-
See, e.g., 56 Fed. Reg. at 35,974. This view probably is a technically correct, if overly literal, reading of the law. By nature, a payment to a sales representative is remuneration to a person in exchange for that person arranging for or recommending the purchase of the manufacturer's product. The OIG recognizes that this activity may not be abusive if undertaken appropriately by persons not in a position to actually purchase or prescribe the product, but it is difficult to argue that the law technically does not prohibit all such activity. Because it is not even remotely plausible that Congress believed it was outlawing all commission-based independent contractor sales/marketing arrangements when it enacted the law's 1977 amendments, this is an obvious deficiency in the law itself, which should be corrected either by regulation or statutory amendment. See infra notes 61, 143-56.
-
-
-
-
65
-
-
0344191746
-
-
OIG Advis. Op. No. 98-10 (Aug. 31, 1998), reprinted
-
OIG Advis. Op. No. 98-10 (Aug. 31, 1998), reprinted at 2 Health Care Fraud Rep. (BNA) 680 (1998).
-
(1998)
Health Care Fraud Rep. (BNA)
, vol.2
, pp. 680
-
-
-
66
-
-
0344191750
-
-
note
-
Id. at 3. Under the prospective payment system used by Medicare, hospital patients are grouped into categories (DRGs) by diagnosis. Hospitals are paid a lump sum to care for each patient, which varies according to the DRG to which the patient is assigned. For an explanation of how Medicare calculates prospective payment for hospitals under the DRG payment system, see generally 42 C.F.R. part 412, subpart D.
-
-
-
-
67
-
-
0344623470
-
-
Sept. 22
-
See 56 Fed. Reg. at 35,981 (rejecting commentator arguments that independent contractors should be protected under the employee exception to the antikickback law). See generally 123 CONG. REC. 30,280 (Sept. 22, 1977); H. CONF. REP. NO. 95-673, 95th Cong., 1st Sess., at 6-10 (1977); H.R. REP. NO 95-393, pt. 1, 95th Cong., 1st Sess., at 8-11 (1977) (discussing such arrangements in legislative history of antikickback law). Interestingly, the OIG'S basis for rejecting the legislative history suggesting that Congress intended for independent contractors to be protected under the employment exception was that the relevant remarks were made in commenting on the House version of the bill (which referred to "employees") rather than the compromise Conference version (which took the Senate's language and referred to "bona fide employees"). Because one easily might argue that there is no legal distinction between "employees" and "bona fide" (meaning "real") employees, it is unclear whether the OIG's interpretation would survive if subjected to litigation.
-
(1977)
Cong. Rec.
, vol.123
, pp. 30280
-
-
-
68
-
-
0345054008
-
-
See 56 Fed. Reg. at 35,981 (rejecting commentator arguments that independent contractors should be protected under the employee exception to the antikickback law). See generally 123 CONG. REC. 30,280 (Sept. 22, 1977); H. CONF. REP. NO. 95-673, 95th Cong., 1st Sess., at 6-10 (1977); H.R. REP. NO 95-393, pt. 1, 95th Cong., 1st Sess., at 8-11 (1977) (discussing such arrangements in legislative history of antikickback law). Interestingly, the OIG'S basis for rejecting the legislative history suggesting that Congress intended for independent contractors to be protected under the employment exception was that the relevant remarks were made in commenting on the House version of the bill (which referred to "employees") rather than the compromise Conference version (which took the Senate's language and referred to "bona fide employees"). Because one easily might argue that there is no legal distinction between "employees" and "bona fide" (meaning "real") employees, it is unclear whether the OIG's interpretation would survive if subjected to litigation.
-
(1977)
H. Conf. Rep. No. 95-673, 95th Cong., 1st Sess.
, pp. 6-10
-
-
-
69
-
-
0344974436
-
-
95th Cong., 1st Sess.
-
See 56 Fed. Reg. at 35,981 (rejecting commentator arguments that independent contractors should be protected under the employee exception to the antikickback law). See generally 123 CONG. REC. 30,280 (Sept. 22, 1977); H. CONF. REP. NO. 95-673, 95th Cong., 1st Sess., at 6-10 (1977); H.R. REP. NO 95-393, pt. 1, 95th Cong., 1st Sess., at 8-11 (1977) (discussing such arrangements in legislative history of antikickback law). Interestingly, the OIG'S basis for rejecting the legislative history suggesting that Congress intended for independent contractors to be protected under the employment exception was that the relevant remarks were made in commenting on the House version of the bill (which referred to "employees") rather than the compromise Conference version (which took the Senate's language and referred to "bona fide employees"). Because one easily might argue that there is no legal distinction between "employees" and "bona fide" (meaning "real") employees, it is unclear whether the OIG's interpretation would survive if subjected to litigation.
-
(1977)
H.R. Rep. No 95-393
, Issue.1 PART
, pp. 8-11
-
-
-
70
-
-
0345485669
-
-
OIG Advis. Op. No. 99-3 (Mar. 16, 1999), reprinted
-
OIG Advis. Op. No. 99-3 (Mar. 16, 1999), reprinted at 3 Health Care Fraud Rep. (BNA) 273 (1999).
-
(1999)
Health Care Fraud Rep. (BNA)
, vol.3
, pp. 273
-
-
-
72
-
-
0344623458
-
-
OIG Advis. Op. No. 98-1 (Mar. 19, 1998), reprinted
-
OIG Advis. Op. No. 98-1 (Mar. 19, 1998), reprinted at 2 Health Care Fraud Rep. (BNA) 255 (1998).
-
(1998)
Health Care Fraud Rep. (BNA)
, vol.2
, pp. 255
-
-
-
74
-
-
0345054000
-
-
Id.
-
Id.
-
-
-
-
75
-
-
0344191742
-
-
Id.
-
Id.
-
-
-
-
76
-
-
0345485661
-
-
note
-
See, e.g., United States v. Tapert, 625 F.2d 111 (6th Cir.), cert. denied sub nom. Freedlander v. United States, 449 U.S. 952 (1980) (volume dependent payments to physicians from laboratories); United States v. Ruttenberg, 625 F.2d 173 (7th Cir. 1980) (monthly fees "for the opportunity to provide drugs and pharmaceutical services" from suppliers to nursing home owners); United States v. Hancock, 604 F.2d 999 (7th Cir.), cert. denied, 444 U.S. 991 (1979) (percentage payments to chiropractors from laboratory).
-
-
-
-
77
-
-
0345053997
-
Advertising, Marketing and Promotional Practices of the Pharmaceutical Industry: Hearings before the Senate Committee on Labor and Human Resources
-
See generally Advertising, Marketing and Promotional Practices of the Pharmaceutical Industry: Hearings Before the Senate Committee on Labor and Human Resources, 101st Cong., 2d Sess. (1990).
-
(1990)
101st Cong., 2d Sess.
-
-
-
78
-
-
0026437456
-
Guidelines on Gifts to Physicians from Industry: An Update
-
including interpretive commentary in the form of questions and answers
-
See AMA Council on Ethical and Judicial Affairs, Guidelines on Gifts to Physicians from Industry: An Update, 47 FOOD & DRUG L.J. 445 (1992) (including interpretive commentary in the form of questions and answers). The AMA Guidelines originally were issued in December 1990, and first published in 236 JAMA 501 (1991). The Guidelines state: 1. Any gifts accepted by physicians individually should primarily entail a benefit to patients and should not be of substantial value. Accordingly, textbooks, modest meals, and other gifts are appropriate if they serve a genuine educational function. Cash payments should not be accepted. 2. Individual gifts of minimal value are permissible as long as the gifts are related to the physician's work (e.g., pens and notepads). 3. Subsidies to underwrite the costs of continuing medical education conferences or professional meetings can contribute to the improvement of patient care and therefore are permissible. Since the giving of a subsidy directly to a physician by a company's sales representative may create a relationship which could influence the use of the company's products, any subsidy should be accepted by the conference's sponsor who in turn can use the money to reduce the conference's registration fee. Payments to defray the costs of a conference should not be accepted directly from the company by the-physicians attending the conference. 4. Subsidies from industry should not be accepted directly or indirectly to pay for the costs of travel, lodging or other personal expenses of physicians attending conferences or meetings, nor should subsidies be accepted to compensate for the physicians' time. Subsidies for hospitality should not be accepted outside of modest meals or social events held as part of a conference or meeting. It is appropriate for facuhy at conferences or meetings to accept reimbursement for reasonable travel, lodging and meal expenses. It is also appropriate for consultants who provide genuine services to receive reasonable compensation and to accept reimbursement for reasonable travel, lodging and meal expenses. Token consulting or advisory arrangements cannot be used to justify compensating physicians for their time or their travel, lodging and other out-of-pocket expenses. 5. Scholarships or other special funds to permit medical students, residents and fellows to altend carefully selected educational conferences may be permissible as long as the selection of students, residents or fellows who will receive the funds is made by the academic or training institution. 6. No gifts should be accepted if the re are strings attached. For example, physicians should not accept gifts if they are given in relation to the physicians' prescribing practices. In addition, when companies underwrite medical conferences or lectures other than their own, responsibility for and control over the selection of content, faculty, educational methods and materials should belong to the organizers of the conferences or lectures. AMA GUIDELINES ON GIFTS TO PHYSICIANS FROM INDUSTRY (Dec. 1990).
-
(1992)
Food & Drug L.J.
, vol.47
, pp. 445
-
-
-
79
-
-
0344191738
-
-
The AMA Guidelines originally were issued in December 1990, and first published
-
See AMA Council on Ethical and Judicial Affairs, Guidelines on Gifts to Physicians from Industry: An Update, 47 FOOD & DRUG L.J. 445 (1992) (including interpretive commentary in the form of questions and answers). The AMA Guidelines originally were issued in December 1990, and first published in 236 JAMA 501 (1991). The Guidelines state: 1. Any gifts accepted by physicians individually should primarily entail a benefit to patients and should not be of substantial value. Accordingly, textbooks, modest meals, and other gifts are appropriate if they serve a genuine educational function. Cash payments should not be accepted. 2. Individual gifts of minimal value are permissible as long as the gifts are related to the physician's work (e.g., pens and notepads). 3. Subsidies to underwrite the costs of continuing medical education conferences or professional meetings can contribute to the improvement of patient care and therefore are permissible. Since the giving of a subsidy directly to a physician by a company's sales representative may create a relationship which could influence the use of the company's products, any subsidy should be accepted by the conference's sponsor who in turn can use the money to reduce the conference's registration fee. Payments to defray the costs of a conference should not be accepted directly from the company by the-physicians attending the conference. 4. Subsidies from industry should not be accepted directly or indirectly to pay for the costs of travel, lodging or other personal expenses of physicians attending conferences or meetings, nor should subsidies be accepted to compensate for the physicians' time. Subsidies for hospitality should not be accepted outside of modest meals or social events held as part of a conference or meeting. It is appropriate for facuhy at conferences or meetings to accept reimbursement for reasonable travel, lodging and meal expenses. It is also appropriate for consultants who provide genuine services to receive reasonable compensation and to accept reimbursement for reasonable travel, lodging and meal expenses. Token consulting or advisory arrangements cannot be used to justify compensating physicians for their time or their travel, lodging and other out-of-pocket expenses. 5. Scholarships or other special funds to permit medical students, residents and fellows to altend carefully selected educational conferences may be permissible as long as the selection of students, residents or fellows who will receive the funds is made by the academic or training institution. 6. No gifts should be accepted if the re are strings attached. For example, physicians should not accept gifts if they are given in relation to the physicians' prescribing practices. In addition, when companies underwrite medical conferences or lectures other than their own, responsibility for and control over the selection of content, faculty, educational methods and materials should belong to the organizers of the conferences or lectures. AMA GUIDELINES ON GIFTS TO PHYSICIANS FROM INDUSTRY (Dec. 1990).
-
(1991)
JAMA
, vol.236
, pp. 501
-
-
-
80
-
-
0005250770
-
-
Dec.
-
See AMA Council on Ethical and Judicial Affairs, Guidelines on Gifts to Physicians from Industry: An Update, 47 FOOD & DRUG L.J. 445 (1992) (including interpretive commentary in the form of questions and answers). The AMA Guidelines originally were issued in December 1990, and first published in 236 JAMA 501 (1991). The Guidelines state: 1. Any gifts accepted by physicians individually should primarily entail a benefit to patients and should not be of substantial value. Accordingly, textbooks, modest meals, and other gifts are appropriate if they serve a genuine educational function. Cash payments should not be accepted. 2. Individual gifts of minimal value are permissible as long as the gifts are related to the physician's work (e.g., pens and notepads). 3. Subsidies to underwrite the costs of continuing medical education conferences or professional meetings can contribute to the improvement of patient care and therefore are permissible. Since the giving of a subsidy directly to a physician by a company's sales representative may create a relationship which could influence the use of the company's products, any subsidy should be accepted by the conference's sponsor who in turn can use the money to reduce the conference's registration fee. Payments to defray the costs of a conference should not be accepted directly from the company by the-physicians attending the conference. 4. Subsidies from industry should not be accepted directly or indirectly to pay for the costs of travel, lodging or other personal expenses of physicians attending conferences or meetings, nor should subsidies be accepted to compensate for the physicians' time. Subsidies for hospitality should not be accepted outside of modest meals or social events held as part of a conference or meeting. It is appropriate for facuhy at conferences or meetings to accept reimbursement for reasonable travel, lodging and meal expenses. It is also appropriate for consultants who provide genuine services to receive reasonable compensation and to accept reimbursement for reasonable travel, lodging and meal expenses. Token consulting or advisory arrangements cannot be used to justify compensating physicians for their time or their travel, lodging and other out-of-pocket expenses. 5. Scholarships or other special funds to permit medical students, residents and fellows to altend carefully selected educational conferences may be permissible as long as the selection of students, residents or fellows who will receive the funds is made by the academic or training institution. 6. No gifts should be accepted if the re are strings attached. For example, physicians should not accept gifts if they are given in relation to the physicians' prescribing practices. In addition, when companies underwrite medical conferences or lectures other than their own, responsibility for and control over the selection of content, faculty, educational methods and materials should belong to the organizers of the conferences or lectures. AMA GUIDELINES ON GIFTS TO PHYSICIANS FROM INDUSTRY (Dec. 1990).
-
(1990)
Ama Guidelines on Gifts to Physicians from industry
-
-
-
83
-
-
0345485658
-
-
supra note 70
-
The Commentary to the Guidelines indicates that gifts not worth more than about $100 to the receiving physician will not be deemed of "substantial value." See AMA Guidelines: An Update, supra note 70, at 451-52.
-
AMA Guidelines: An Update
, pp. 451-452
-
-
-
84
-
-
0344623452
-
-
note
-
The Commentary to the Guidelines indicates that this means the major educational, scientific, or policymaking meetings of national, regional, or specialty medical associations, rather than conferences or symposia designed specifically for students, residents, or fellows. Am. Med. Ass'n, Clarification, Oct. 1, 1993.
-
-
-
-
85
-
-
0024826182
-
Doctors. Drug Companies and Gifts
-
See Mary Margaret Chen, M.D., Tom H. Murray, Ph.D., & Charles S. Landefeld, M.D., Doctors. Drug Companies and Gifts, 262 JAMA 3448 (1989).
-
(1989)
JAMA
, vol.262
, pp. 3448
-
-
Chen, M.M.1
Murray, T.H.2
Landefeld, C.S.3
-
86
-
-
0345053990
-
-
Id. passim
-
Id. passim.
-
-
-
-
89
-
-
24544447731
-
Caremark Cited in an Indictment over Payments
-
Aug. 5, See infra notes 95-96 and accompanying text
-
See, e.g., Caremark Cited in an Indictment Over Payments, WALL ST. J., Aug. 5, 1994, at A2. See infra notes 95-96 and accompanying text.
-
(1994)
Wall St. J.
-
-
-
90
-
-
0345485657
-
FBI Increases Health Care Fraud Criminal Investigations over 30%
-
Feb. 4
-
FBI Increases Health Care Fraud Criminal Investigations Over 30%, F-D-C Rep., Health News Daily, Feb. 4, 1992, at 3.
-
(1992)
F-D-C Rep., Health News Daily
, pp. 3
-
-
-
92
-
-
0344623446
-
-
Id. at 7
-
Id. at 7.
-
-
-
-
93
-
-
0345485655
-
-
Pub. L. No. 104-191, § 201(b), 110 Stat. 1936, 1993-96(adding 42 U.S.C. § 1395i(k) (SSA § 1817))
-
Pub. L. No. 104-191, § 201(b), 110 Stat. 1936, 1993-96(adding 42 U.S.C. § 1395i(k) (SSA § 1817)).
-
-
-
-
94
-
-
0345485651
-
Justice Department Health Care Fraud Cases under Review Totaled over 4,000 in 1997
-
Aug. 13
-
Justice Department Health Care Fraud Cases Under Review Totaled Over 4,000 in 1997, F-D-C Rep., Health News Daily, Aug. 13, 1998, at 5.
-
(1998)
F-D-C Rep., Health News Daily
, pp. 5
-
-
-
95
-
-
0032498680
-
G-Men; Federal Resources are Stacking up to Tackle Health Care Fraud
-
Mar. 9
-
G-Men; Federal Resources are Stacking up to Tackle Health Care Fraud, MODERN HEALTHCARE, Mar. 9, 1998, at 32.
-
(1998)
Modern Healthcare
, pp. 32
-
-
-
96
-
-
0344623444
-
Crackdown on Health Care Fraud Nets $480 Million in Fiscal 1998, Report Says
-
Mar. 5
-
Crackdown on Health Care Fraud Nets $480 Million in Fiscal 1998, Report Says, BNA's Medicare Rep., Mar. 5, 1999, at 270.
-
(1999)
BNA's Medicare Rep.
, pp. 270
-
-
-
97
-
-
0344191730
-
-
supra note 84
-
G-Men, supra note 84, at 32.
-
G-Men
, pp. 32
-
-
-
98
-
-
0345485648
-
-
Id. at 33
-
Id. at 33.
-
-
-
-
100
-
-
0344623442
-
-
See supra note 18 and accompanying text
-
See supra note 18 and accompanying text.
-
-
-
-
101
-
-
0345485643
-
DHHS Fact Sheet Concerning DHHS' Operation Restore Trust
-
reprinted (CCH) Transfer Binder, ¶ 43,213
-
See, e.g., DHHS Fact Sheet Concerning DHHS' Operation Restore Trust, reprinted in Medicare & Medicaid Guide (CCH) [1995-1 Transfer Binder], ¶ 43,213.
-
(1995)
Medicare & Medicaid Guide
-
-
-
102
-
-
4243696665
-
Fraud and Abuse: Operation Restore Trust First Year Brings $42.3 Million to Government
-
May 14
-
Fraud and Abuse: Operation Restore Trust First Year Brings $42.3 Million to Government, BNA Health Care Daily, May 14, 1996, at d2.
-
(1996)
BNA Health Care Daily
-
-
-
103
-
-
24544439090
-
Fraud and Abuse: Expanded Operation Restore Trust to Target More Providers in More States
-
Mar. 25
-
See, e.g., Fraud and Abuse: Expanded Operation Restore Trust to Target More Providers in More States, BNA Health Care Daily, Mar. 25, 1997, at d6.
-
(1997)
BNA Health Care Daily
-
-
-
104
-
-
24544445684
-
Probe in Texas of Columbia Comes to Head
-
Dec. 23
-
See, e.g., Probe in Texas of Columbia Comes to Head, WALL ST. J., Dec. 23, 1997, at A3; For Biggest Hospital Operator, a Debate Over the Ties That Bind, N. Y. TIMES, Apr. 6, 1997, at A1.
-
(1997)
Wall St. J.
-
-
-
105
-
-
24544468986
-
For Biggest Hospital Operator, a Debate over the Ties That Bind
-
Apr. 6
-
See, e.g., Probe in Texas of Columbia Comes to Head, WALL ST. J., Dec. 23, 1997, at A3; For Biggest Hospital Operator, a Debate Over the Ties That Bind, N. Y. TIMES, Apr. 6, 1997, at A1.
-
(1997)
N. Y. Times
-
-
-
106
-
-
0345485638
-
Battle Escalates over Feds False Claims Tactics
-
Nov. 24
-
With regard to PATH, see, e.g., Battle Escalates over Feds False Claims Tactics, NAT'L INTELL. REP., Nov. 24, 1997, at 6; Inspector General's "PATH" Initiative is Aimed at Uncovering Faulty Billing for Teaching Physicians Under Medicare, WASHINGTON FAX, Oct. 30, 1996, at 1; In Crackdown on Health Care Fraud, U.S. Focuses on Training Hospitals and Clinics. N. Y. TIMES, Dec. 22, 1995, at A32; University Agrees to Pay in Settlement on Medicare, N. Y. TIMES, Dec. 13, 1995, at A 18. With regard to LabScam, see, e.g., SmithKline to Pay $325 Million to Settle Federal Claims of Lab-Billing Fraud, WALL ST. J., Feb. 25, 1997, at B6.
-
(1997)
Nat'l Intell. Rep.
, pp. 6
-
-
-
107
-
-
0345053972
-
Inspector General's "PATH" Initiative is Aimed at Uncovering Faulty Billing for Teaching Physicians under Medicare
-
Oct. 30
-
With regard to PATH, see, e.g., Battle Escalates over Feds False Claims Tactics, NAT'L INTELL. REP., Nov. 24, 1997, at 6; Inspector General's "PATH" Initiative is Aimed at Uncovering Faulty Billing for Teaching Physicians Under Medicare, WASHINGTON FAX, Oct. 30, 1996, at 1; In Crackdown on Health Care Fraud, U.S. Focuses on Training Hospitals and Clinics. N. Y. TIMES, Dec. 22, 1995, at A32; University Agrees to Pay in Settlement on Medicare, N. Y. TIMES, Dec. 13, 1995, at A 18. With regard to LabScam, see, e.g., SmithKline to Pay $325 Million to Settle Federal Claims of Lab-Billing Fraud, WALL ST. J., Feb. 25, 1997, at B6.
-
(1996)
Washington Fax
, pp. 1
-
-
-
108
-
-
0010643363
-
In Crackdown on Health Care Fraud, U.S. Focuses on Training Hospitals and Clinics
-
Dec. 22
-
With regard to PATH, see, e.g., Battle Escalates over Feds False Claims Tactics, NAT'L INTELL. REP., Nov. 24, 1997, at 6; Inspector General's "PATH" Initiative is Aimed at Uncovering Faulty Billing for Teaching Physicians Under Medicare, WASHINGTON FAX, Oct. 30, 1996, at 1; In Crackdown on Health Care Fraud, U.S. Focuses on Training Hospitals and Clinics. N. Y. TIMES, Dec. 22, 1995, at A32; University Agrees to Pay in Settlement on Medicare, N. Y. TIMES, Dec. 13, 1995, at A 18. With regard to LabScam, see, e.g., SmithKline to Pay $325 Million to Settle Federal Claims of Lab-Billing Fraud, WALL ST. J., Feb. 25, 1997, at B6.
-
(1995)
N. Y. Times
-
-
-
109
-
-
24544438183
-
University Agrees to Pay in Settlement on Medicare
-
Dec. 13
-
With regard to PATH, see, e.g., Battle Escalates over Feds False Claims Tactics, NAT'L INTELL. REP., Nov. 24, 1997, at 6; Inspector General's "PATH" Initiative is Aimed at Uncovering Faulty Billing for Teaching Physicians Under Medicare, WASHINGTON FAX, Oct. 30, 1996, at 1; In Crackdown on Health Care Fraud, U.S. Focuses on Training Hospitals and Clinics. N. Y. TIMES, Dec. 22, 1995, at A32; University Agrees to Pay in Settlement on Medicare, N. Y. TIMES, Dec. 13, 1995, at A 18. With regard to LabScam, see, e.g., SmithKline to Pay $325 Million to Settle Federal Claims of Lab-Billing Fraud, WALL ST. J., Feb. 25, 1997, at B6.
-
(1995)
N. Y. Times
-
-
-
110
-
-
0344034385
-
SmithKline to Pay $325 Million to Settle Federal Claims of Lab-Billing Fraud
-
Feb. 25
-
With regard to PATH, see, e.g., Battle Escalates over Feds False Claims Tactics, NAT'L INTELL. REP., Nov. 24, 1997, at 6; Inspector General's "PATH" Initiative is Aimed at Uncovering Faulty Billing for Teaching Physicians Under Medicare, WASHINGTON FAX, Oct. 30, 1996, at 1; In Crackdown on Health Care Fraud, U.S. Focuses on Training Hospitals and Clinics. N. Y. TIMES, Dec. 22, 1995, at A32; University Agrees to Pay in Settlement on Medicare, N. Y. TIMES, Dec. 13, 1995, at A 18. With regard to LabScam, see, e.g., SmithKline to Pay $325 Million to Settle Federal Claims of Lab-Billing Fraud, WALL ST. J., Feb. 25, 1997, at B6.
-
(1997)
Wall St. J.
-
-
-
111
-
-
24544444335
-
Judge Acquits 3 Caremark Execs of Paying Kickbacks to Doctor
-
Oct. 4, The physician who had received these payments, however, was convicted on two counts of violating the antikickback law
-
See United States v. Caremark, No. Cr. 4-94-95 (D. Minn.), Information, Plea Agreement, Joint Stipulation of Facts in Support of Plea Agreement, and Corporate Integrity Agreement (undated). The Caremark settlement agreement explicitly did not cover employees. Three Caremark employees, indicted on allegations related to payments to one particular physician, were acquitted following a jury trial, as was an employee of the manufacturer of the drug distributed by Caremark. See. e.g., Judge Acquits 3 Caremark Execs of Paying Kickbacks to Doctor, CHI. TRIB., Oct. 4, 1995, at B4. The physician who had received these payments, however, was convicted on two counts of violating the antikickback law. See, e.g., Jury Convicts Pediatrician in Kickback Trial. S.F. CHRON., Oct. 20, 1995, at B2.
-
(1995)
Chi. Trib.
-
-
-
112
-
-
4243696666
-
Jury Convicts Pediatrician in Kickback Trial
-
Oct. 20
-
See United States v. Caremark, No. Cr. 4-94-95 (D. Minn.), Information, Plea Agreement, Joint Stipulation of Facts in Support of Plea Agreement, and Corporate Integrity Agreement (undated). The Caremark settlement agreement explicitly did not cover employees. Three Caremark employees, indicted on allegations related to payments to one particular physician, were acquitted following a jury trial, as was an employee of the manufacturer of the drug distributed by Caremark. See. e.g., Judge Acquits 3 Caremark Execs of Paying Kickbacks to Doctor, CHI. TRIB., Oct. 4, 1995, at B4. The physician who had received these payments, however, was convicted on two counts of violating the antikickback law. See, e.g., Jury Convicts Pediatrician in Kickback Trial. S.F. CHRON., Oct. 20, 1995, at B2.
-
(1995)
S.F. Chron.
-
-
-
113
-
-
24544431655
-
Genentech Settlement of Changes in Drug Investigation
-
Apr. 9
-
See Genentech Settlement of Changes in Drug Investigation, WALL ST. J., Apr. 9, 1999, at B16: Genentech Settlement Agreed, SCRIP, Apr. 16, 1999, at 10; Genentech's $50 Million U.S. Fine, SCRIP, Apr. 21, 1999, at 14. According to the Wall Street Journal article, the kickback allegations appear not be part of the plea or settlement agreement.
-
(1999)
Wall St. J.
-
-
-
114
-
-
0345053967
-
Genentech Settlement Agreed
-
Apr. 16
-
See Genentech Settlement of Changes in Drug Investigation, WALL ST. J., Apr. 9, 1999, at B16: Genentech Settlement Agreed, SCRIP, Apr. 16, 1999, at 10; Genentech's $50 Million U.S. Fine, SCRIP, Apr. 21, 1999, at 14. According to the Wall Street Journal article, the kickback allegations appear not be part of the plea or settlement agreement.
-
(1999)
SCRIP
, pp. 10
-
-
-
115
-
-
0345053966
-
Genentech's $50 Million U.S. Fine
-
Apr. 21
-
See Genentech Settlement of Changes in Drug Investigation, WALL ST. J., Apr. 9, 1999, at B16: Genentech Settlement Agreed, SCRIP, Apr. 16, 1999, at 10; Genentech's $50 Million U.S. Fine, SCRIP, Apr. 21, 1999, at 14. According to the Wall Street Journal article, the kickback allegations appear not be part of the plea or settlement agreement.
-
(1999)
SCRIP
, pp. 14
-
-
-
116
-
-
0344623435
-
-
article, the kickback allegations appear not be part of the plea or settlement agreement
-
See Genentech Settlement of Changes in Drug Investigation, WALL ST. J., Apr. 9, 1999, at B16: Genentech Settlement Agreed, SCRIP, Apr. 16, 1999, at 10; Genentech's $50 Million U.S. Fine, SCRIP, Apr. 21, 1999, at 14. According to the Wall Street Journal article, the kickback allegations appear not be part of the plea or settlement agreement.
-
Wall Street Journal
-
-
-
117
-
-
24544464703
-
Roche Holdings Unit Will Pay $450,000 to Settle Fraud Claim
-
Sept. 6
-
See Off. of Inspector Gen., Fact Sheet on Settlement Agreement with Hoffmann-La Roche, Inc., New Jersey, Sept. 2, 1994; Roche Holdings Unit Will Pay $450,000 To Settle Fraud Claim, WALL ST. J., Sept. 6, 1994, at B6; Hoffmann-La Roche to Pay DHHS $450,000 Settlement, WASH. POST. Sept. 3, 1994, at C1.
-
(1994)
Wall St. J.
-
-
-
118
-
-
24544470533
-
Hoffmann-La Roche to Pay DHHS $450,000 Settlement
-
Sept. 3
-
See Off. of Inspector Gen., Fact Sheet on Settlement Agreement with Hoffmann-La Roche, Inc., New Jersey, Sept. 2, 1994; Roche Holdings Unit Will Pay $450,000 To Settle Fraud Claim, WALL ST. J., Sept. 6, 1994, at B6; Hoffmann-La Roche to Pay DHHS $450,000 Settlement, WASH. POST. Sept. 3, 1994, at C1.
-
(1994)
Wash. Post.
-
-
-
119
-
-
0344623433
-
-
See Settlement Agreement between United States and Ayerst Laboratories, Inc., July 29, 1993
-
See Settlement Agreement between United States and Ayerst Laboratories, Inc., July 29, 1993.
-
-
-
-
120
-
-
0345053964
-
-
note
-
See Letters from Michael B. McCulley, Gen. Att'y, Johnson & Johnson, to Robert A. Simon, Assistant Inspector Gen., (Feb. 7 & 10, 1992). Under the terms of the settlement. Johnson & Johnson agreed to discontinue the aspect of the program that involved frequent flyer miles to prescribing physicians, to channel all rebates through the purchasing pharmacist, and to remind the pharmacist of his or her obligation to reflect price reductions on claims for payment. The latter two requirements appear designed to ensure that Medicare and Medicaid receive any benefits of price reductions. See also infra note 114 (new Medicare civil money penalty for inducements to patients).
-
-
-
-
121
-
-
0345485626
-
-
note
-
See Commonwealth of Mass., Off. of the Att'y Gen., Drug Company Pays $200,000 to Settle Kickback Claims (June 30, 1994); Settlement Agreement Between Miles Inc. and the Commonwealth of Massachusetts, Dep't of the Att'y Gen. (June 30, 1994); In re Upjohn Company, C7-94-7856, Order Approving Assurance of Discontinuance (Ramsey Cty. (Mass.) Dist. Ct., Aug. 1, 1994). As noted above, these practices also appear to constitute "suspect" practices under the Drug Marketing Fraud Alert. See supra notes 20-23 and accompanying text.
-
-
-
-
122
-
-
0344623432
-
-
See supra note 5
-
See supra note 5.
-
-
-
-
123
-
-
0345485625
-
-
§ 151.461 The statute also imposes annual reporting requirements on wholesale drug distributors, id. § 151.47, a term that the Minnesota Pharmacy Board interprets to include any manufacturer that distributes prescription drugs in Minnesota to persons other than a consumer or a patient. See id. § 151.449a
-
See MINN. STAT. ANN. § 151.461 (Supp. 1999). The statute also imposes annual reporting requirements on wholesale drug distributors, id. § 151.47, a term that the Minnesota Pharmacy Board interprets to include any manufacturer that distributes prescription drugs in Minnesota to persons other than a consumer or a patient. See id. § 151.449a).
-
(1999)
Minn. Stat. Ann.
, Issue.SUPPL.
-
-
-
124
-
-
0344191717
-
-
See Commonwealth of Mass., Off. of the Att'y Gen., N.J. Pharmaceutical Corporation Settles With Attorney General: 21,000 Nitroglycerin Patches to Be Distributed Free of Charge (May 21, 1993); Settlement Agreement Between Commonwealth of Massachusetts and Schering Corporation (May 20, 1993)
-
See Commonwealth of Mass., Off. of the Att'y Gen., N.J. Pharmaceutical Corporation Settles With Attorney General: 21,000 Nitroglycerin Patches to Be Distributed Free of Charge (May 21, 1993); Settlement Agreement Between Commonwealth of Massachusetts and Schering Corporation (May 20, 1993).
-
-
-
-
125
-
-
0344623430
-
-
See Settlement Agreement Between Commonwealth of Massachusetts and Novo
-
b 1.5 Delivery System Promotion to Medicaid Patients ( Mar 19, 1997).
-
-
-
-
126
-
-
0344623429
-
-
See Settlement Agreement Between Mallinckrodt Chemical, Inc. and the Commonwealth of Massachusetts, (Jan. 23, 1998)
-
See Settlement Agreement Between Mallinckrodt Chemical, Inc. and the Commonwealth of Massachusetts, (Jan. 23, 1998).
-
-
-
-
127
-
-
0344623428
-
-
note
-
For the purposes of this article, "gifts and business courtesies" are defined as straightforward economic benefits to customers that plainly are designed to create goodwill that will make it more likely the customer will want to purchase the giver's product.
-
-
-
-
128
-
-
0344191714
-
-
Inspector General v. Hanlester Network, DHHS Dep't App. Bd., App. Div., Sept. 19, at 48 n.34, reprinted (CCH) ¶ 39,566
-
There is, of course, a contrary argument that the intent to build goodwill with customers and physicians should not be deemed to rise to the level of an unlawful inducement to purchase the manufacturer's product. This argument arguably was rejected by the DHHS Departmental Appeals Board (DAB) in Hanlester. In deciding that drug samples and recruitment lunches did not constitute remuneration, the DAB focused on the de minimis nature of those benefits, suggesting that only if the benefit were small enough would they avoid the antikickback law. The Board apparently assumed that if the benefit were large enough to "influence the physician's reason and judgment," it would have involved the impermissible intent of inducing the physician to purchase or order the drug. See Inspector General v. Hanlester Network, (DHHS Dep't App. Bd., App. Div., Sept. 19, 1991) at 48 n.34, reprinted in Medicare & Medicaid Guide (CCH) ¶ 39,566 at 27,763 n.34.
-
(1991)
Medicare & Medicaid Guide
, Issue.34
, pp. 27763
-
-
-
129
-
-
0345485624
-
-
note
-
Id. ("de minimis or very remote forms of remuneration, such as drug samples or recruitment lunches, may not be subject to prosecution.... If the remuneration offered is unlikely to affect physician referral decisions, it is probably not intended to induce referrals, absent clear evidence to the contrary") (emphasis in original).
-
-
-
-
131
-
-
0345485623
-
-
63 Fed. Reg. 1659, 1725 (Jan. 9, 1998)
-
63 Fed. Reg. 1659, 1725 (Jan. 9, 1998).
-
-
-
-
132
-
-
0344191711
-
-
See, e.g., Settlement Agreement between Commonwealth of Massachusetts and The Rugby Group, Inc., Civ. Action No. 94-2731 (May 15, 1994) (Rugby paid $200,000 in settlement of allegations that the company provided numerous pharmacists with vacation packages at selected resort locations with purchase of the company's products)
-
See, e.g., Settlement Agreement between Commonwealth of Massachusetts and The Rugby Group, Inc., Civ. Action No. 94-2731 (May 15, 1994) (Rugby paid $200,000 in settlement of allegations that the company provided numerous pharmacists with vacation packages at selected resort locations with purchase of the company's products).
-
-
-
-
133
-
-
0344191713
-
Food & Drug Law institute Conference
-
May 20, 1997, Washington, D.C., reported May 26, at T&G-15
-
Remarks by Kevin McAnaney at Food & Drug Law institute Conference, May 20, 1997, Washington, D.C., reported in F-D-C Rep. ("The Pink Sheet") May 26, 1997, at T&G-15.
-
(1997)
F-D-C Rep. ("The Pink Sheet")
-
-
McAnaney, K.1
-
135
-
-
0345485621
-
-
note
-
See supra note 99 and accompanying text. Patient coupons also present difficulties with reporting and passing along price reductions to Medicare and Medicaid, thus preventing many of them from qualifying for the discount safe harbor. See supra note 37 and accompanying text. For these reasons, many manu facturer coupon programs exclude Medicare and Medicaid patients, a practice that can result in difficulties with state regulators. See, e.g., supra note 103 and accompanying text. Congress also has adopted a civil monetary penalty law amendment that specifically forbids remuneration to Medicare beneficiaries to induce them to order covered items or services from a particular provider, practitioner, or supplier 42 U.S.C. § 1320a-7a(a)(5). On its face, however, this provision would not seem to apply to patient coupon programs offered by manufacturers, which Medicare does not treat as providers, practitioners, or suppliers. Patient coupon programs also may implicate state and federal insurance fraud or other laws to the extent that they reduce or eliminate cost-sharing or coinsurance requirements.
-
-
-
-
136
-
-
0345485622
-
New Partnership for Patient Programs
-
Mar.
-
See supra note 57. See New Partnership for Patient Programs, PHARM. EXEC., Mar. 1997, at 78.
-
(1997)
Pharm. Exec.
, pp. 78
-
-
-
137
-
-
24544481531
-
Study Finds Music Soothes Surgeons, Medicine
-
Sept. 21
-
See, e.g., Study Finds Music Soothes Surgeons, Medicine, L.A. TIMES, Sept. 21, 1994, at A20.
-
(1994)
L.A. Times
-
-
-
138
-
-
0344191710
-
-
May reprinted in 59 Fed. Reg. at 65,374-75
-
In fact, OIG has indicated that routine waiver of copayments, in the absence of demonstrated financial need, violates the antikickback law. See Off. of Inspector Gen., Special Fraud Alert: Routine Waiver of Copayments or Deductibles Under Medicare Part B, May 1991, reprinted in 59 Fed. Reg. at 65,374-75.
-
(1991)
Off. of Inspector Gen., Special Fraud Alert: Routine Waiver of Copayments or Deductibles under Medicare
, Issue.PART B
-
-
-
139
-
-
0344191709
-
-
As noted above, however, providing reimbursement advice to customers may increase the chances that a manufacturer will be subject to liability under the FCA. See supra note 4
-
As noted above, however, providing reimbursement advice to customers may increase the chances that a manufacturer will be subject to liability under the FCA. See supra note 4.
-
-
-
-
140
-
-
0345485620
-
-
note
-
See, e.g., 54 Fed. Reg. at 3091. The analysis in this section applies to payments for services to the manufacturer, not to general or unrestricted grants that allow customers to pursue research of interest to the customer or for any other purpose. Such payments are more properly characterized as gifts, and should be analyzed under the preceding section.
-
-
-
-
141
-
-
0345485618
-
-
See, e.g., 56 Fed. Reg. at 35,972
-
See, e.g., 56 Fed. Reg. at 35,972.
-
-
-
-
142
-
-
0344191707
-
-
See, e.g., id. at 35.953 (payment varies with volume of referrals); 54 Fed. Reg. at 3090 (payment not for fair market value of services)
-
See, e.g., id. at 35.953 (payment varies with volume of referrals); 54 Fed. Reg. at 3090 (payment not for fair market value of services).
-
-
-
-
143
-
-
0344191706
-
-
42 C.F.R. § 1001.952(d); see also id. § 1001.952(i) (employee safe harbor)
-
42 C.F.R. § 1001.952(d); see also id. § 1001.952(i) (employee safe harbor).
-
-
-
-
144
-
-
0344191705
-
-
Id.
-
Id.
-
-
-
-
145
-
-
0344191703
-
-
note
-
In addition, if compensation for a post-approval clinical study were structured on a per patient basis, it also would not be possible to satisfy the requirement that aggregate payment be set in advance and be unrelated to the volume or value of business generated between the parties, because treating more patients could lead to more compensation. If compensation is reasonable, as discussed below, however, the failure to meet this criterion arguably would not be abusive. This criterion arguably could be satisfied if a single amount for all study patients was agreed to in advance, although it might be advisable to consider some mechanism to reduce the overall payment if patients drop out of the study.
-
-
-
-
146
-
-
0344623422
-
-
See. e.g., 56 Fed. Reg. at 35,954
-
See. e.g., 56 Fed. Reg. at 35,954.
-
-
-
-
147
-
-
0344623426
-
-
Id.; see also supra note 8 and accompanying text
-
Id.; see also supra note 8 and accompanying text.
-
-
-
-
148
-
-
0345053957
-
-
See supra notes 77-78 and accompanying text
-
See supra notes 77-78 and accompanying text.
-
-
-
-
149
-
-
0345485613
-
-
But see supra note 41
-
But see supra note 41.
-
-
-
-
150
-
-
33645630721
-
-
Some insight, at least, into the OIG's view of studies that are more than likely to be used for promotional purposes, can be found in an April OIG report, supra note 77
-
Some insight, at least, into the OIG's view of studies that are more than likely to be used for promotional purposes, can be found in an April 1991 OIG report, PROMOTION OF PRESCRIPTION DRUGS THROUGH PAYMENTS AND GIFTS, supra note 77.
-
(1991)
Promotion of Prescription Drugs Through Payments and Gifts
-
-
-
151
-
-
0345053954
-
-
42 C.F.R. § 1001.952(d)
-
42 C.F.R. § 1001.952(d).
-
-
-
-
152
-
-
0344623421
-
-
Pub. L. No. 101-508, 104 Stat. 1388 (1990) (codified at 42 U.S.C. § 1396r-8 (SSA § 1927) (1994))
-
Pub. L. No. 101-508, 104 Stat. 1388 (1990) (codified at 42 U.S.C. § 1396r-8 (SSA § 1927) (1994)).
-
-
-
-
153
-
-
0345485611
-
-
note
-
See, e.g., 61 Fed. Reg. 46,166, 46,176 (Aug. 30, 1996) (reweighting DRGs based on charge data received for Medicare beneficiaries). Currently, HCFA does not rely on acquisition cost data, but keeping this information accurate still is viewed as important by the OIG because HCFA may wish to rely on this kind of data at some time in the future.
-
-
-
-
154
-
-
0345053955
-
-
OIG Advis. Op. No. 99-3, supra note 62, at 3-4
-
See OIG Advis. Op. No. 99-3, supra note 62, at 3-4, 3 Health Care Fraud Rep. at 274-75.
-
Health Care Fraud Rep.
, vol.3
, pp. 274-275
-
-
-
156
-
-
0344623420
-
-
Id.
-
Id.
-
-
-
-
157
-
-
0344623417
-
-
For example, under federal law, states are required to establish standards for pharmacist counseling of Medicaid beneficiaries. 42 U.S.C. § 1396r-8(g)(2)(A)(ii) (SSA § 1927(g)(2)(A)(ii)); 42 C.F.R. § 456.705(c)
-
For example, under federal law, states are required to establish standards for pharmacist counseling of Medicaid beneficiaries. 42 U.S.C. § 1396r-8(g)(2)(A)(ii) (SSA § 1927(g)(2)(A)(ii)); 42 C.F.R. § 456.705(c).
-
-
-
-
158
-
-
0345053951
-
-
Mar. 24
-
See supra notes 131-36 and accompanying text. An OIG attorney recently called into question even this commonplace practice, however, noting that her office had "concerns" with market share rebates given to pharmacies. F-D-C Rep., Health News Daily, Mar. 24, 1999, at 2 (reporting remarks of OIG Attorney Vicki Robinson at American Society of Consultant Pharmacists Conference, Mar. 23, 1999, Washington, D.C.).
-
(1999)
F-D-C Rep., Health News Daily
, pp. 2
-
-
-
159
-
-
0344191700
-
-
reporting remarks of OIG Attorney Vicki Robinson Mar. 23, Washington, D.C.
-
See supra notes 131-36 and accompanying text. An OIG attorney recently called into question even this commonplace practice, however, noting that her office had "concerns" with market share rebates given to pharmacies. F-D-C Rep., Health News Daily, Mar. 24, 1999, at 2 (reporting remarks of OIG Attorney Vicki Robinson at American Society of Consultant Pharmacists Conference, Mar. 23, 1999, Washington, D.C.).
-
(1999)
American Society of Consultant Pharmacists Conference
-
-
-
160
-
-
0345053950
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Foundation Health: Calls off Controversial Drug Deal
-
Oct. 15, As one consumer advocate commented "[t]here was nothing to justify this deal. I think this will spark legislation to prohibit this type of unseemly kickback that benefits neither the patient, the doctor or the health care system." Id.
-
This concern may have motivated one HMO and a drug manufacturer to back away from just such an arrangement in 1998. See Foundation Health: Calls Off Controversial Drug Deal, CONGRESS DAILY, Oct. 15, 1998. As one consumer advocate commented "[t]here was nothing to justify this deal. I think this will spark legislation to prohibit this type of unseemly kickback that benefits neither the patient, the doctor or the health care system." Id.
-
(1998)
Congress Daily
-
-
-
161
-
-
0344191696
-
Federal Prosecutors May Scrutinize Manufacturer/PBM Company Contacts
-
Dec. 21, (remarks of Assistant U.S. Attorney James Sheehan)
-
See Federal Prosecutors May Scrutinize Manufacturer/PBM Company Contacts, F-D-C Rep., Health News Daily, Dec. 21, 1998, at 1 (remarks of Assistant U.S. Attorney James Sheehan). See also supra note 137. Cf. Remarks of James Sheehan at American Society of Consulting Pharmacists 28th Annual Meeting, at 6-7 (Nov. 12-15, 1997, Philadelphia, PA).
-
(1998)
F-D-C Rep., Health News Daily
, pp. 1
-
-
-
162
-
-
0345053949
-
-
Nov. 12-15, Philadelphia, PA
-
See Federal Prosecutors May Scrutinize Manufacturer/PBM Company Contacts, F-D-C Rep., Health News Daily, Dec. 21, 1998, at 1 (remarks of Assistant U.S. Attorney James Sheehan). See also supra note 137. Cf. Remarks of James Sheehan at American Society of Consulting Pharmacists 28th Annual Meeting, at 6-7 (Nov. 12-15, 1997, Philadelphia, PA).
-
(1997)
American Society of Consulting Pharmacists 28th Annual Meeting
, pp. 6-7
-
-
Sheehan, J.1
-
163
-
-
0345485605
-
-
Id.
-
Id.
-
-
-
-
164
-
-
0345053948
-
-
note
-
Of course, to the extent that the PBM actually passes through discounts to the ultimate payers (e.g. health plans), those payments probably could be structured either to meet discount safe harbor requirements, or to present no reasonable basis for an enforcement proceeding.
-
-
-
-
165
-
-
24544454075
-
Merck's Medco to Change Procedures on Prescriptions, Settling with 17 States
-
Oct. 26
-
See In re Merck & Co., Inc. and Medco Containment Servs., Inc., No. C6 95 10614, Agreement (Oct. 25, 1995); Merck's Medco to Change Procedures On Prescriptions, Settling With 17 States, WALL ST. J., Oct. 26, 1995, at B8; Merck Subdivision Settles Charges It Broke Fraud Laws, WASH. TIMES, Oct. 26, 1995, at B10.
-
(1995)
Wall St. J.
-
-
-
166
-
-
4243696663
-
Merck Subdivision Settles Charges It Broke Fraud Laws
-
Oct. 26
-
See In re Merck & Co., Inc. and Medco Containment Servs., Inc., No. C6 95 10614, Agreement (Oct. 25, 1995); Merck's Medco to Change Procedures On Prescriptions, Settling With 17 States, WALL ST. J., Oct. 26, 1995, at B8; Merck Subdivision Settles Charges It Broke Fraud Laws, WASH. TIMES, Oct. 26, 1995, at B10.
-
(1995)
Wash. Times
-
-
-
167
-
-
0344191695
-
-
Sec supra notes 59-64 and accompanying text
-
Sec supra notes 59-64 and accompanying text.
-
-
-
-
168
-
-
0344623410
-
-
See supra notes 5, 59-64 and accompanying text
-
See supra notes 5, 59-64 and accompanying text.
-
-
-
-
169
-
-
0344191692
-
-
See supra note 40 and accompanying text. But see supra note 41
-
See supra note 40 and accompanying text. But see supra note 41.
-
-
-
-
170
-
-
0345053942
-
-
As noted above, this position is debatable in light of the law's legislative history. See supra note 61
-
As noted above, this position is debatable in light of the law's legislative history. See supra note 61.
-
-
-
-
171
-
-
0345485601
-
-
See supra notes 50-51 and accompanying text
-
See supra notes 50-51 and accompanying text.
-
-
-
-
172
-
-
0344191689
-
-
note
-
See supra notes 59-64 and accompanying text. While not necessarily relevant to the OIG's enforcement priorities, at least two courts have taken the position that commissions to independent sales representatives represent per se violations of the law. See Nursing Home Consultants, Inc. v. Quantum Health Serv. Inc., 926 F. Supp. 835, 844 (E.D. Ark. 1996); Medical Dev. Network, 673 So.2d 565. These cases are distinguishable because they were private contract disputes between the parties, and may have involved some degree of marketing directly to patients, A more troubling decision recently was reached by a California appellate court, which interpreted that state's Medicaid antikickback law as & per se prohibition on commission sales. People v. Duz-Mor Diagnostic Lab., 68 Cal. App. 4th 654 (2d App. Dist. 1998). Again, there is a possibly relevant distinction, in that the California law does not have a "knowingly and willfully" requirement.
-
-
-
-
173
-
-
0344191690
-
-
See supra note 61 and accompanying text
-
See supra note 61 and accompanying text.
-
-
-
-
174
-
-
0345485599
-
-
Id.
-
Id.
-
-
-
-
175
-
-
0344191687
-
-
56 Fed. Reg. at 35,974
-
56 Fed. Reg. at 35,974.
-
-
-
-
176
-
-
0345053941
-
-
Id.
-
Id.
-
-
-
-
177
-
-
0345053939
-
-
See supra note 60 and accompanying text
-
See supra note 60 and accompanying text.
-
-
-
-
178
-
-
0344623407
-
-
note
-
These concerns should not preclude companies from hiring physicians on a reasonable fixed-fee basis (e.g., per diem or per hour rate) to perform consulting services, including participating in speakers' bureaus or other educational activities on behalf of a product. While such arrangements clearly implicate the law, they generally should not be found to violate the law if theamount paid to the physician is appropriate compensation for his or her time and effort (and not dependent on sales), especially if the presentations are made to medical professionals orpayors and not directly to patients. See supra notes 119-28 and accompanying text.
-
-
-
-
179
-
-
0345053940
-
-
note
-
For example, a fixed amount per month could be paid to the other company, which then could create incentives for its own employees under the umbrella of the employment safe harbor.
-
-
-
-
180
-
-
0344623405
-
-
note
-
Obviously, these criteria provide little comfort to manufacturers whose primary selling strategy is to "detail" prescribing physicians on the use of outpatient products. For this reason, a new safe harbor or a statutory amendment would be necessary to truly protect legitimate and appropriate commission sales activity. See infra Part VI.B.2.
-
-
-
-
181
-
-
0344191685
-
-
See, e.g., Balanced Budget Act of 1997, Pub. L. No. 105-33, § 4001 (establishing Medicare+Choice program)
-
See, e.g., Balanced Budget Act of 1997, Pub. L. No. 105-33, § 4001 (establishing Medicare+Choice program).
-
-
-
-
182
-
-
0345485598
-
-
See, e.g., 56 Fed. Reg. at 35,961
-
See, e.g., 56 Fed. Reg. at 35,961.
-
-
-
-
183
-
-
0345053936
-
-
See supra notes 47-49 and accompanying text
-
See supra notes 47-49 and accompanying text.
-
-
-
-
184
-
-
0345485593
-
Managed Care: Placebo or Wonder Drug for Health Care Fraud & Abuse?
-
See, e.g., Sharon L. Davies & Timothy Stoltzfus Jost, Managed Care: Placebo or Wonder Drug for Health Care Fraud & Abuse?, 31 GA. L. REV. 373, 391-93 (1997).
-
(1997)
Ga. L. Rev.
, vol.31
, pp. 373
-
-
Davies, S.L.1
Jost, T.S.2
-
185
-
-
0344623403
-
-
note
-
See supra notes 138-42 and accompanying text. Of course, discount arrangements with risk-basis HMOs may satisfy the requirements of the discount safe harbor. 42 C.F.R. § 1001.952(h). Another safe harbor, for price reductions to health plans by contract health care providers, may not be available, because manufacturers may not meet the definition of a "contract health care provider." 42 C.F.R. § 1001.952.
-
-
-
-
186
-
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0345053935
-
-
See supra note 9 and accompanying text
-
See supra note 9 and accompanying text.
-
-
-
-
187
-
-
0344623399
-
-
note
-
For example, since 1994, the OIG has had the authority to impose a variety of penalties on Medicare and Medicaid MCOs that, inter alia, fail to provide medically necessary care to enrollees. See 42 U.S.C. §§ 1395mm(I)(6)(A), 1396b(m)(5)(A); 42 C.F.R. § 417.500(a). These authorities have been augmented by additional requirements imposed on MCOs by the new Medicare+Choice regulations. See 63 Fed. Reg. 34,968 (June 26, 1998) (interim final rule with comment period); see also 63 Fed. Reg. 52,022 (Sept. 29, 1998) (containing similar requirements in proposed rule allowing states greater flexibility to require Medicaid recipients to enroll in MCOs).
-
-
-
-
188
-
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0345485590
-
-
See Davies & Jost, supra note 160, at 390-92
-
See Davies & Jost, supra note 160, at 390-92.
-
-
-
-
189
-
-
0032608387
-
The Role of the States in Combating Managed Care Fraud & Abuse
-
See id. at 388; see also Joan H. Krause, The Role of the States in Combating Managed Care Fraud & Abuse, 8 ANNALS HEALTH L, 179 (1999).
-
(1999)
Annals Health L
, vol.8
, pp. 179
-
-
Krause, J.H.1
-
190
-
-
0344191679
-
-
See HIPAA, Pub. L. No. 104-191, § 205, 110 Stat. 2000-01 (adding 42 U.S.C. § 1320a-7d(a)(SSA § 1128D))
-
See HIPAA, Pub. L. No. 104-191, § 205, 110 Stat. 2000-01 (adding 42 U.S.C. § 1320a-7d(a)(SSA § 1128D)).
-
-
-
-
191
-
-
0032498007
-
-
63 Fed. Reg. 1659, 1724-25 (Jan. 9, 1998) (proposing amendment to 42 C.F.R. § 411.357(d))
-
63 Fed. Reg. 1659, 1724-25 (Jan. 9, 1998) (proposing amendment to 42 C.F.R. § 411.357(d)).
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