Courts Are Not Taking Anti-Kickback Violations Lightly

August 29, 2013

A pair of recent court decisions further highlights the need for physicians to comply with the Anti-Kickback Statute and the Sunshine Act.

Federal courts are not taking healthcare fraud lightly. The Eleventh Circuit Court of Appeals, which includes Florida, Georgia, Alabama, and the U.S. Virgin Islands affirmed sentences given by a U.S. District Court of two individuals found guilty, by their own admission, of healthcare fraud.

In United States v. Gonzales, the Court indicated:
Waldo Gonzalez and Jorge Luis Reyes each appeal their total sentences of 120 months’ imprisonment imposed after they pled guilty to conspiracy to pay health care kickbacks, in violation of 18 U.S.C. § 371, and payment of healthcare kickbacks, in violation of 42 U.S.C. § 1320a-7b(b)(2)(B). For the reasons set forth below, we affirm Gonzalez’s and Reyes’s sentences. United States v. Gonzales, Nos. 12-15127, 12-15128 (11th Cir. July 31, 2013).

Given that the Physician Payment Sunshine Act’s reporting requirements are in effect this month, providing more information about payments from pharma and others, taking notice of the consequences of engaging in violations of the Anti-Kickback Statute (AKS) is timely. In this case, Gonzalez and Reyes pled guilty at the trial level and admitted to all facts in the evidence. Gonzalez denied participating in the conversations associated with the violating conduct. To the contrary, the evidence presented showed that he was not only present during certain activity, but also benefited more than any other individual involved.

Under the U.S. Sentencing Guidelines, a sentence reduction may be considered, but the district courts have a great degree of discretion when deciding whether or not to award sentence level reductions. Because Gonzalez was unable to illustrate that the court plainly erred in applying Section 2B4.1 of the Sentencing Guidelines when it decided to apply a 20-level increase to his offense level because of the value of the improper benefit he gained. Therefore, given that the trial court proceedings were found to reasonable in substance and procedure, the sentences were found reasonable.

This case highlights the potential consequences and the need for compliance with the AKS and the Sunshine Act.