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Can Actions Be Considered Remuneration Under the Anti-Kickback Statute?

When discussing the Anti-Kickback Statute (AKS), it’s common to say that “remuneration” can be “anything of value.” That board definition has been called into question by the Sixth Circuit in United States ex rel. Martin v. Hathaway et al., No. 22-1463. In that case, a qui tam relator (physician) alleged that a small-town hospital refused to hire her in exchange for a physician group to continue to send the hospital referrals. The “value” then was the not hiring a physician in exchange for referrals. The AKS does not define “remuneration.”

The Sixth Circuit determined that a careful examination of the meaning of “remuneration” and context shows that this term is limited to “payments and other transfer of value,” not “any act that may be valuable to another.” Thus the act of not hiring the physician is not remuneration.

Further, even if remuneration was present, the court stated that False Claims Act liability “resulting from” an AKS violation requires showing but-for causation. In other words, an FCA plaintiff must show “that the referrals would not have been made without the remuneration, and that the claims would not have been submitted to the government without those referrals.” Here, the qui tam physician was unable to point to any specfic Medicare claims that would not have been submitted as a result of the hospital’s decision not to hire the physician.