Health Care Fraud & Abuse Seminar

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Health Care Fraud & Abuse Seminar

For the sixth year, whistleblower attorney Bob Thomas is teaching a course at Boston University School of Law on “Health Care Fraud and Abuse.” The course covers the major substantive laws in this field, including The False Claims Act, the Anti-Kickback Act, Stark, and the Food Drug and Cosmetic Act (including off-label and misbranding).  In addition, the students hear from practitioners in the field, including prosecutors, compliance attorneys, defense lawyers, and whistleblower lawyers — as a means of accessing the many ways in which one can work in this field.


The course includes some practical problem-solving.  Each week, students are given an assignment that is similar to a situation that might come up in their practice.  Last week, concerning the Anti-Kickback Act, they were asked the following:


You’re a partner in a law firm that represents pharma clients and other large businesses.  A pharma client emails you and asks:  “Hey, could you give me a little guidance on this Anti-Kickback stuff?  I’m confused by it.  I’ve read an article or two on it, and they seem to be talking about “inducement” as the main idea.  What if the money and perks we give to doctors aren’t intended to induce them to change their behavior?  What if it’s because we’re loyal to our customers and want to thank them?  What if we are careful to not link our financial payments to doctors to any attempt to persuade them to use our drugs.  Who gets to decide whether something was intended to induce if there is not written record of things?  I see that despite the new disclosure laws, my competitors are still paying lots of money, as are we, to doctors.  Should we stop, or just keep on keepin’ on, being careful not to go near the inducement line?  Does the government give any guidance on this stuff?”


Some thoughts on what might go into an answer:


With greater transparency now that payments to doctors are a matter of public record, there is indeed greater scrutiny of who is being paid for what.  Not surprisingly, there is a spectrum of conduct here, ranging from the relatively benign (a drug rep drops off a small number of free samples of the product) to the outright vile (doctor is paid a “consultancy fee” based on the number of devices he/she implants in patients).


While doctors typically insist that they are not influenced by the payment of money, common sense tells us otherwise, as John Oliver effectively lampoons.  If the payments didn’t influence doctors, the drug and device companies wouldn’t do it!!


So the partner’s question is really a little off base, and the associate will have to find a way to say so diplomatically.  Even if a company says that the payments are not “intended to induce” but rather are to thank the doctor (or some other euphemism),  the company does not have the final say.  In the end, a prosecutor and a judge and ultimately a jury are the final arbiters if the matter gets put under the microscope.


Yes, the government does give guidance on these issues, particularly at the website of the Inspector General of the Department of Health and Human services.  There are advisory opinions and other forms of guidance that help inform the regulated industries.


The bottom line:  the payments better be for something real, be commercially reasonable for a service actually performed and independent of the doctor’s prescribing of the medication, and in no colorable way linked to the amount of product the doctor is using.  The pharma client should be advised to get precise advice on the Safe Harbors of the AKA, and to be sure that the payments fall within them.  Getting close doesn’t count.  You’re either in the safe harbor or you’re not.


**Note:  As advocates, lawyers have an ethical duty to zealously represent their clients.  The associate might have a personal opinion about this conduct and may have to put those feelings aside in giving the advice to the partner.  If this were not a client of the firm, it might be tempting to say simply:  “Tell them to cut it out!  Of course these huge payments are causing mischief.  Knock it off!”