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Healthcare business expansion opportunity: Is it a violation?

| Dec 1, 2020 | Health & Health Care Law |

There are many federal regulations that apply to the provision of healthcare. It is not always easy for healthcare professionals to balance these regulations with a need to expand and take advantage of an opportunity to better serve their community. Healthcare providers and business professionals operating within this marketplace must tread carefully as a violation of applicable federal regulations can result in fines, the loss of one’s medical license and allegations of criminal wrongdoing.

What federal rules can apply to expansion opportunities within the healthcare marketplace?

These rules fall into a number of different areas, including patient record confidentiality and myriad of regulations around the use of Medicare, Medicaid and other government as well as private insurance providers. The federal government uses the False Claims Act (FCA) for example, to hold organizations and individuals accountable for knowingly filing false or fraudulent claims to the government for payment. Whistleblower incentives are available, allowing those who begin a claim on the government’s behalf to get a portion of any monetary awards that result from the claim.

Another federal regulation that may apply is the Anti-Kickback Statute (AKS) which allows the government to penalize certain providers who provide or accept bribes in exchange for referrals or recommendations. Similarly, the Stark Law results in penalties for those who refer to a facility that would result in their own profit.

How can groups avoid a violation and still take advantage of an opportunity for growth and expansion?

Thorough due diligence before, during and after the proposed transaction will help to better ensure compliance. This will also provide an opportunity to fix any issues before they become a bigger problem.


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