What is the Federal Anti-Kickback Statute and Why It Should Matter to You?

Drug companies who want doctors to write prescriptions for the drugs they make would do well to not ask physicians out to dinner and drinks, in order to get them to write these prescriptions. Questcor, a subsidiary of the global drug company, Mallinckrodt, allegedly, wined and dined, and lavishly entertained physicians between the years 2009 and 2013. In return, these physicians were, allegedly, to write prescriptions for the repository corticotropin injection called H.P. Acthar Gel, thus violating the Federal Anti-Kickback Statute.

Mallinckrodt ARD Inc. has now agreed to pay $15.4 million to resolve these claims. It should be noted that Mallinckrodt bought Questcor in 2014, making Mallinckrodt responsible for another company’s actions before ownership, and it is unclear if the parent company knew of these “payments” during the acquisition period.

The other problem for why the company now must pay out the money is that this drug is on a list of those which are reimbursed by federal health care programs, including Medicare. This issue falls under the False Claims Act (FCA), originally enacted in 1863 (also known as Lincoln’s Law), now applies healthcare to reduce fraud, abuse, and mismanagement in the health and drug industry. The above drug case was initially begun under a filing of the False Claims Act.

What is the Federal Anti-Kickback Statute (AKS)?

The AKS was enacted in 1972 within the Social Security Amendments that concerned false claims made to Medicare and Medicaid, creating a fraudulent status. AKS addresses explicitly cases of those entities who pay medical groups and physicians to use their products (drugs, medical equipment, etc.) where government agencies repay those fees. Payments can also be in the form of free rent of a facility, acceptance of gifts, solicitation and referrals rewards, and more unless they fall under the “safe harbor” regulation.

The Price of Doing Business

As of September 10, 2019, Tuesday, Mallinckrodt began selling off some of its assets to gather up the settlement money, starting with its contract manufacturing unit. Canadian BioVectra, Inc. will go to an affiliate of HIG Capital for $250 million, with an upfront payout of $135 million, contingent payments of $75 million, and a $40 million long-term note, according to an article on Bizjournals.com. While rumors of bankruptcy may be nervously whispered in the hallways of the company, Mallinckrodt CEO Mark Trudeau currently denies that this will happen.

How You, as a Patient, Should Help Yourself

As the patient, you are unlikely to be directly affected by what is happening with the large drug companies, unless you lose your doctor because of some action of wrong-doing connected to the AKS or FCA. Here are a few tips on working with your doctor to ensure that you’re not offered drugs or medical devices that you might not need.

Whenever you are prescribed a drug, surgery, or medical device, always ask your doctor what other alternatives you can look at. Knowing what the pros and cons are for each available solution is essential for making the best choice for your health and comfort.

Asking your doctor questions about a solution does not mean you have little faith in your doctor’s advice or knowledge. It is more that you will want to get the best outcome for your health and recovery and that your relationship with your doctor is a partnership in finding the best recovery solutions, not a battle of wills.

If you have doubts about whether a medical solution offered by your doctor is the best one for you and you have not received satisfaction from questions asked of your doctor, get a second opinion, even a third opinion from other doctors. Do your research as well as there is plenty of information online that can give you some oversight about drug reactions or recalls on medical devices too.

If you need help with your workers’ compensation claim or have a problem with your medical care, call us at once for a consultation. 602-346-9009.