U.S. District Judge Jeremy D. Kernodle recently concluded a seven-week-long trial of five defendants. The state accused the five defendants, a mix of lab and hospital executives, of Anti-Kickback Statute violations allegedly involving physicians making referrals to a rural hospital and lab in exchange for investment returns. The prosecution argues these investment returns were actually illegal kickbacks.
Upon review of the evidence, the jury found the defendants guilty of conspiring to violate the Anti-Kickback Statute (AKS). They now await sentencing.
#1: These cases can take time.
The government moved forward with the indictment in January of 2022, meaning the investigation began even earlier. It took almost two years to move forward through the indictment to the conclusion of the trial — which could continue even further if there is an appeal.
It is important that anyone facing similar allegations take note. These allegations do not simply go away. They take years to navigate from investigation to a resolution.
#2: The feds are watching arrangements between hospitals and diagnostic labs.
This case provides an example of how the government will move forward with a claim against diagnostic labs as it involved a relationship between local Texas hospitals and a clinical laboratory out of Massachusetts. Although it could be argued the lab provided specialized services, the government stated the relationship led to the hospital wrongly claiming a larger payment rate for the services.
#3: Use of marketers can also result in a closer look.
The hospitals in this case also used a group of marketers who were offering investment opportunities to physicians throughout the state. Instead of aiding in investment opportunities, the prosecution claims these marketers were really just funnelling kickback payments.
Use of marketers in itself is not illegal, but the rules are complex, and a violation can result in allegations of wrongdoing. It is important to carefully review the relationship to better ensure it does not run afoul of applicable regulations.
#4: Healthcare fraud allegations are often just the beginning.
In addition to AKS violations, the state also pursued additional criminal charges against the accused including money laundering and perjury. In addition to financial penalties, the defendants face the potential of years of imprisonment.
These lessons serve as a stark reminder to take allegations of healthcare fraud seriously. Thankfully, you do not have to face these allegations alone. You can seek legal counsel to help defend your interests and better ensure your rights are protected throughout the process.
Attorney John Rivas is responsible for this communication.