The Supreme Court of the United States recently agreed to review a case on kickbacks. The case involves Pfizer, pharmaceutical mega-giant, who appealed a lower court’s holding. The company tried to argue that its plan to cover Medicare patients’ co-payments for an expensive heart medication did not equate to illegal kickbacks. Instead, they claim the proposal would focus on middle-class who could benefit from these medications but did not qualify for other cost saving measures.
The Supreme Court disagreed. They upheld the lower court’s ruling, stating that such an agreement would rise to the level of a violation of the Anti-Kickback Statute (AKS) and that criminal penalties could apply.
#1: The government takes its Anti-Kickback laws seriously.
This is a legal tool the government uses to push back against big pharma and individual actors whenever it believes an individual or business sent fraudulent claims to one of its programs, like Medicare. If it believes there is evidence of a violation, it will move forward and investigate. If it gathers evidence to support the claims, it could choose to move forward with criminal charges.
#2: Intent is not enough.
Pfizer tried to argue that since their motives were pure, to aid those who need the medications, the law should not apply. The court did not agree, noting the lack of corrupt intent did not shield them from liability.
#3: Internal audits are important.
Regular internal audits can check for compliance to federal and state regulations, like the AKS. When used wisely, they can provide a way to catch a potential problem before it grows into a serious concern that could catch the government’s attention and lead to allegations of a violation.
These allegations are serious. A violation of the AKS can come with tens of thousands in financial penalties, potential imprisonment, and lead to an investigation of a nurse or physician’s professional license (if involved in the allegations).
Attorney John Rivas is responsible for this communication