Rethinking Health Care’s Anti-Kickback Laws

The Trump administration issued a request for recommendations on relaxing kickback and self-referral laws that are intended to protect Medicare and Medicaid recipients from fraudulent practices committed by health-care providers. Current federal regulations prohibit hospitals from rewarding doctors who cut costs through value-based care and insurers from rewarding patients who reduce overall health costs by losing weight or taking medicines as prescribed.

The original purpose of the law is to ensure health-care providers make decisions based on patient care, rather than financial interest. However, critics argue that the anti-kickback rules makes it more difficult to coordinate care by limiting doctors’ ability to refer patients to medical businesses to which they have financial ties. The strict regulations also may stifle “many innocuous or beneficial arrangements,” according to James L. Madara, MD, chief executive of the American Medical Association, who spoke to The New York Times.

Still, proponents of the anti-kickback laws claim that rolling back these rules would increase the risk of health-care fraud. “The administration is inviting companies in the health care industry to write a ‘get out of jail free card’ for themselves, which they can use if they are investigated or prosecuted,” James J. Pepper, a lawyer who has represented many whistle-blowers in the industry, told The New York Times.

While federal officials review proposals, the Department of Justice (DOJ) continues to pursue violations. Last month, the owner of a Florida pharmacy pled guilty to paying kickbacks to Medicare beneficiaries who filled prescriptions at his business. In April, the DOJ settled a lawsuit against Insys Therapeutics, which was accused of incentivizing doctors to prescribe its powerful opioid.

Source: The New York Times, November 24, 2018.