-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. Compensation must not be determined in a manner that takes into account volume or value of referrals. Compensation must be fair market reasonable, fair market value and determined through armâs length negotiations. Exceptions to anti-kickback statutes Anti-kickback laws prohibit you from receiving any sort of financial remuneration regarding the referral of patients. Reg. SAFE HARBORS GENERALLY Safe harbors immunize certain payment and business practices that are implicated by the anti-kickback statute from criminal and civil prosecution under the statute. Recently finalized changes to rules implementing the Stark Law and Anti-Kickback Statute — effective in January — drew support from provider groups. As a general rule, safe harbor regulations set protection between financial and business relations and referring parties conducted at fair market view. 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. These regulations created eight new safe harbor provisions which protect arrangements from criminal prosecution and civil sanctions under the anti-kickback statute, 42 U.S.C. Fair market value is one of the most important aspects of the foregoing exceptions. by the parties • The lease . In the preamble to the 1991 final safe harbor rules, the OIG explained that the anti-kickback statute “on its face prohibits offering or acceptance of remuneration, inter alia, for the purposes of ‘arranging for or recommending purchasing, leasing, or ordering any... service or item’ payable under Medicare or Medicaid.” 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. 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. © 2021 Berger Montague All Rights Reserved, Remuneration Under the Anti-Kickback Statute Includes Intangible Economic Benefits, The Anti-Kickback Statute vs. • Not required to fit within safe harbor because ultimate question is whether “one purpose” of remuneration is to induce or reward referrals. However, the OIG interprets the âset in advanceâ 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. 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 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 See 42 C.F.R. There is no rule of thumb that will suffice in all situations to determine the amount of documentation required to confirm fair market value, so whether a lease rate is consistent with fair market value is a question of fact that must be determined on a case-by-case basis. For purposes of the office space rental exception, the fair market value for the rental of a medical office building cannot be based solely on the rental rate for other medical office buildings. 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. The Anti-Kickback Statute makes it a crime to intentionally offer or receive payment or anything of value in exchange for referrals for services or goods that are reimbursable by the federal government, primarily Medicare or Medicaid. • The closer you come to satisfying regulatory requirements, the safer you will be. Thus a short term contract which may be necessary or desirable for business purposes will not qualify for anti-kickback safe harbor protection. Revisions to the Safe Harbors Under the Anti-Kickback Statute and Civil Monetary Penalty Rules Regarding Beneficiary Inducements, 81 Fed. These laws place specific limitations on the manner in which certain healthcare providers may lease space to physician tenants. New Safe Harbors. covers all of the premises. Anti-Kickback Statute: Safe Harbors • No liability if satisfy all the requirements of a safe harbor. § 1320a-7b(b) (âAKSâ), prohibits anyone from knowingly and willfully offering, paying, soliciting, or receiving remuneration in order to induce reimbursable business under federal or state healthcare programs. Prior results do not guarantee a similar outcome. Agreement must specify aggregate payment, and such payment must be set in advance. APPLICATION OF THE ANTI-KICKBACK STATUTE DISCOUNT SAFE HARBOR TO BUNDLED SALES. Specifically, leases of space in hospitals or hospital-owned medical office buildings implicate theAnti-Kickback Statute and Stark Law. The most consistent challenge â and perhaps the most unique to healthcare â is satisfying the many laws and regulations in place when leasing space from certain healthcare providers to other healthcare providers. -This provision is intended to ensure that the terms of an agreement cannot be adjusted periodically to take into account referrals or other business between the parties simply by scrapping one agreement and entering into a new agreement with different compensation terms. Anti-Kickback Statute Safe Harbor: Personal Services and Management Contracts The Anti-Kickback Statute, 42 U.S.C. The Anti-Kickback Statute provides that doctors, hospitals, and other healthcare providers can’t induce medical providers to refer patients based on illegal inducements and incentives. The arrangement must serve a commercially reasonable business purpose. All arrangements must be in ONE contract. § 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. Anti-kickback changes add safe-harbor protections. The Anti-Kickback rule changes include a safe harbor for cybersecurity donations. On November 20, 2020, the US Department of Health and Human Services (HHS) released final rules amending the regulations to the physician self-referral law (Stark Law) and the Anti-Kickback Statute (AKS) and Beneficiary Inducement Civil Monetary Penalty Law (CMPL) (collectively, AKS Rule).The Stark and AKS Rules finalize, with some modifications, most of the … The lease agreement is set out in writing and signed by the parties. Anti-Kickback Statute – Space Rental Safe Harbor • The lease agreement is set out in . 88368, 88393 (December 7, 2016). covered by the lease • The term of the lease is for not less than . Accordingly, it is critical to document the methodology used to establish fair market value at that time. Agreement must set forth the exact services required to be performed. writing. There are three easy ways to contact our firm for a free, confidential evaluation with one of our whistleblower attorneys: Your submission will be reviewed by a Berger Montague qui tam attorney and remain confidential. 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. specifies the premises. Stark and Anti-Kickback Law Exception and Safe Harbor If you share their questions and concerns, rest assured that in many cases supposed kickbacks are actually covered under federal safe harbor statutes. To be protected by a safe harbor, an arrangement must fit squarely in the safe harbor. •To be protected, an arrangement must fit squarely in the safe harbor and satisfy all of its requirements. There are many variations and modifications with respect to these safe harbor and rental exception parameters. Anti-Kickback Safe harbor for payments and other transfers made to a Federally Qualified Health Center The transfer is made pursuant to a contract, lease, grant, loan, or other agreement that-- (A) is set out in writing; (B) is signed by the parties; and (C) covers, and specifies the amount of, all goods, items, services, donations, or loans to be provided by the individual or entity to the FQHC. There cannot be multiple overlapping contracts to circumvent the one-year rule. 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 … leased between the parties for the term of the lease and . 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. 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.” âGeneral market valueâ 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. One such AKS safe harbor is for personal services and management contracts. § 1320a-7b(b). The lease arrangement is set out in writing, is signed by the parties, and specifies the premises it covers. However it is established, fair market value should be assessed at the time of the lease agreement. 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 The Anti-Kickback Statute broadly prohibits the exchange of any value in an effort to induce or reward referrals. Republished with permission. This website contains attorney advertising. The equipment rental safe harbor is pertinent to the lease of a HST device to a physician. Name one way in which the Anti-Kickback Statute differs from the Stark Law. The Department of Health and Human Services has enacted safe harbor regulations that define practices that are not subject to the AKS. 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 … As indicated above, the final rule also creates two new safe harbors to the Anti-Kickback Statute. 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 … Thus, compensation arrangements based on an hourly rate, where the hours of service can vary, will not qualify for safe harbor protection. 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. Stark Law prohibits physicians from making referrals for certain âdesignated health services,â which includes both inpatient and outpatient services, to entities in which the physician has a financial relationship. The Anti-Kickback Statute, 42 U.S.C. (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 … The rate must be based on the broad category of similar properties used for general commercial purposes. Enjoy the videos and music you love, upload original content, and share it all with friends, family, and the world on YouTube. Experienced healthcare lawyers can explain what actions and relationships qualify for safe harbor … 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 safe harbor regulations, in … 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 There are many unique obstacles when leasing healthcare properties. -The term âset in advanceâ is not defined in the safe harbor regulations. The federal Anti-Kickback Statute (AKS) ... Leasing and rental of office space or equipment is considered a safe harbor, provided the lease or rental agreement is for a year or more, ... Doctors who pay or accept kickbacks face penalties of up to $50,000 per kickback plus three times the amount of the remuneration. signed. 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 … You have likely heard of the Anti-Kickback Statute (42 U.S.C. HHS has defined âfair market valueâ as the value in an armâs 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. 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 âspace rental safe harbor,â and Stark Law, commonly referred to as the âoffice space rental exception.â They are: (a) the lease agreement must be in writing; (b) the lease agreement must have at least a one-year term; (c) the rental rate is set in advance, is consistent with fair market value, and is not determined in a manner that will change based on the volume or value of referrals flowing between the parties; (e) the lease agreement covers and specifies all of the leased premises; (f) if the lease agreement is intended to provide the physician tenant with access to the leased premises for periodic intervals (instead of on a full-time basis) the lease agreement must specify exactly the schedule of such intervals; (g) the lease agreement would be commercially reasonable even if no referrals were made between the parties; and (h) the leased premises must not exceed that which is reasonably necessary for the legitimate business purposes of the physician tenant and is used exclusively by such physician tenant. However, safe harbor protection is afforded only to those arrangements that precisely meet all of the conditions set forth in the safe harbor. The first is point-of-sale reductions, by which the rule creates a new safe harbor for discounts that are offered on Part D drugs or drugs covered by Medicaid MCOs at the point of sale. In addition, the timeshare exception, like the Stark rental of office space exception and the Anti-Kickback Statute space rental safe harbor, still requires that all elements used by the licensee (premises, supplies, equipment personnel) be set in advance and … 42 C.F.R § 1001.952(d) The seven requirements of that safe harbor are: Do you need a Whistleblower Lawyer or want to know more information about Qui Tam Law and your rights under the False Claims Act? and . 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. 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