Anti-Kickback Statute: A Guide for Healthcare Whistleblowers

Anti-Kickback Statute and Stark Law: A Quick Summary

Both the Anti-Kickback Statute (AKS) and the Stark Law regulate financial relationships in healthcare. The main differences are:

• The Anti-Kickback Statute applies broadly to any person or entity exchanging value to reward or induce referrals across federal healthcare programs. 
• The Stark Law is narrowly focused, applying only to referrals made by physicians to certain designated health services (DHS) to an entity with which they hold a financial relationship.

What is the Anti-Kickback Statute?

The Anti-Kickback Statute (AKS) is a federal law that prohibits knowingly and willfully offering, paying, soliciting, or receiving anything of value to induce or reward referrals or business involving items or services payable by federal healthcare programs, including Medicare and Medicaid. The law applies to both sides of the arrangement: those offering or paying kickbacks and those requesting or accepting them.

Anti-kickback Statute Examples

Under the Anti-Kickback Statute, remuneration means anything of value, including cash and noncash benefits. Potential kickbacks can take the form of gifts, free or discounted supplies or services, travel, inflated speaking fees, or above-market office rent offered to induce referrals or purchases payable by federal healthcare programs.

State anti-kickback laws may impose additional restrictions on healthcare referral and payment arrangements.

An arrangement involving legitimate services or fair market value payments may still violate the Anti-Kickback Statute. Whether it does depends on the specific facts and the parties’ intent, including whether the payment was intended to induce or reward referrals or other federal healthcare program business.

Anti-Kickback Statute Safe Harbors

Not every financial arrangement in healthcare violates the Anti-Kickback Statute. Federal safe harbor regulations protect certain payment and business arrangements from liability under the statute when all applicable requirements are met. These may include qualifying rental agreements, personal services arrangements, and payments to bona fide employees. An arrangement that does not meet a safe harbor’s requirements is not automatically illegal. It must be evaluated based on its particular facts and circumstances, including the parties’ intent.

Anti-Kickback Statute Penalties

The Anti-Kickback Statute provides for criminal fines of up to $100,000, imprisonment for up to 10 years, or both. Violations can also lead to civil monetary penalties, assessments of up to three times the remuneration involved, and exclusion from federal healthcare programs. 

Claims involving items or services resulting from Anti-Kickback Statute violations may also create liability under the False Claims Act. In eligible cases, whistleblowers can bring a qui tam lawsuit on behalf of the government.

Why is there an Anti-Kickback Law in healthcare?

The federal anti-kickback law helps protect patients and federal healthcare programs from financial incentives that can distort medical decisions, encourage unnecessary treatment, and increase healthcare costs. Healthcare kickbacks – hidden financial arrangements between doctors and hospitals or other healthcare providers or companies – are one of the most complicated and troubling aspects of the healthcare system.

Kickbacks to doctors or other healthcare providers are prohibited by two federal laws: the Anti-Kickback Statute [42 U.S. Code § 1320a–7b(b)] and the Stark Law (42 U.S.C. 1395nn). Whistleblowers can work with the government to stop healthcare kickbacks and improper referrals and receive a reward by filing a “qui tam” lawsuit under the False Claims Act.

Medical and pharmaceutical kickbacks come in many forms. But in every kickback case, healthcare providers will provide some material benefit in return for other providers prescribing or using their products or services.

In most instances, kickbacks are illegal according to anti-kickback laws. Doctors are supposed to decide on the most appropriate treatment for their patients without consideration of their own financial interests.

Federal laws and accompanying regulations prohibit kickbacks and improper compensation to doctors and other healthcare providers as specified by the Stark Law because those financial incentives often result in medically unnecessary treatment and the use of more expensive products. That in turn results in higher costs to patients, Medicare, Medicaid, and other healthcare insurance programs.

Examples of Violations of the Anti-Kickback Statute

Violations of the Anti-Kickback Statute (AKS) occur when a person or entity knowingly and willfully offers, pays, solicits, or receives any remuneration to induce or reward referrals of items or services reimbursable by a federal healthcare program. 

Examples of Anti-Kickback Statute violations could include:

• Medical Device Kickbacks
• Pharmaceutical Company Violations
• Clinical Laboratory Kickbacks
• Hospital-Physician Arrangements
• Home Health Agency Kickbacks
• Durable Medical Equipment (DME) Kickbacks
• Ambulance Service Kickbacks

What are examples of healthcare cases that involve the Anti-Kickback Statute?

Phillips & Cohen has represented whistleblowers in many Anti-Kickback Statute and Stark Law cases that have recovered big sums and earned our whistleblower clients substantial rewards. Here are some examples of our qui tam cases involving the Stark Law and Anti-Kickback Statute:

• GlaxoSmithKline ($3 billion settlement of charges involving kickbacks and off-label marketing). Although most of the allegations against Glaxo involved illegal and harmful off-label marketing practices, Phillips & Cohen’s qui tam lawsuit also alleged that Glaxo attempted to disguise illegal kickbacks to doctors by calling them speaker fees and payments for attending advisory meetings.
• TAP Pharmaceuticals ($875 million settlement). Phillips & Cohen’s whistleblower lawsuit alleged that TAP paid illegal kickbacks, such as free televisions and seminars at resorts, to doctors to prescribe Lupron, its prostate-cancer drug.
• DaVita Healthcare Partners ($400 million settlement). Phillips & Cohen’s qui tam lawsuit alleged that DaVita paid doctors kickbacks in exchange for patient referrals to its dialysis clinics. DaVita allegedly hid these illegal payments in a number of ways, including paying more than fair market value to purchase shares in physician-owned dialysis centers and selling physicians shares in existing DaVita dialysis centers for less than fair-market value.
• Boehringer Ingelheim Pharmaceuticals ($95 million settlement). Phillips & Cohen’s qui tam lawsuit alleged that the pharmaceutical manufacturer used many illegal marketing schemes to induce physicians to prescribe their drugs, including a kickback program.
• Medical device company C.R. Bard Inc. ($48.2 million settlement). Bard allegedly offered doctors many forms of kickbacks, including unrestricted “grant” money, rebates, advertising campaigns and free medical equipment.

Phillips & Cohen also has brought successful whistleblower cases involving violations of the Anti-Kickback Statute against blood testing labs, pharmacies, hospitals, nursing home chains and others in the healthcare industry.

Stark Law vs Anti-Kickback Statute: What’s the difference?

The federal Anti-Kickback Statute and the Stark Law have key differences in what they prohibit and by whom, while sharing similar goals of protecting patients and preventing waste, fraud and abuse in government healthcare programs.

The Anti-Kickback Statute

The Anti-Kickback Statute prohibits anyone from offering or receiving kickbacks in any form to induce or reward those who generate business involving the treatment of patients and services that are reimbursed by Medicare, Medicaid and other government healthcare programs. The Anti-Kickback Statute has some exceptions, referred to as “safe harbors.”

The Stark Law

The Stark Law is more specific than the Anti-Kickback Statute. Stark prohibits physicians from referring Medicare and Medicaid patients for certain medical services to entities with which the physician or immediate family member has a financial relationship, with certain exceptions, or safe harbors. Stark does not require proof of intent.

Stark Law also prohibits health-industry entities from submitting claims to Medicare and Medicaid for services based on a physician referral prohibited by Stark.

Those who violate the Anti-Kickback Statute may be subject to criminal as well as civil penalties, while those who violate the Stark Law are subject to only civil penalties, highlighting the severe consequences of non-compliance with federal healthcare laws.

Violations of the Anti-Kickback Statute and the Stark Law also can be violations of the False Claims Act, and therefore could be the basis for a qui tam lawsuit.

What Information Helps Evaluate a Potential Anti-Kickback Statute Whistleblower Case?

For an initial case review, describe who offered or received the payment or benefit, what referrals or purchases it was connected to, when the arrangement occurred, and how you learned about it. Include what you know about whether the related items or services were billed to Medicare, Medicaid, or another federal healthcare program.

Supporting information may include payment records, contracts, emails, or billing records. You do not need to have all of these documents to seek advice. A whistleblower attorney can assess the information you already have and advise you on handling confidential material and possible next steps.

Contact Phillips & Cohen about suspected healthcare kickbacks

If you are aware of violations of the Anti-Kickback Statute or Stark Law and would like to get a free, confidential review of your case by experienced whistleblower attorneys, please visit our contact page. Phillips & Cohen works with whistleblowers on a contingency basis, which means there is no payment unless the government recovers funds from the case and pays the whistleblower a reward.

Updated on October 14, 2026