This past month, an office worker within a Jersey City doctor’s office pled guilty to healthcare fraud, admitting to receiving approximately $219,000 in kickbacks from a pharmacy in exchange for helping to route prescriptions to the pharmacy’s New Jersey and New York locations, as part of a broader $24.8 million conspiracy. Notably, the kickbacks at issue, which took the form of cash and cash equivalents, expensive meals and designer bags, when amortized over the approximate 10-year-period during which they were paid, would amount to relatively low-dollar-value gifts. As such, this case presents the opportunity to make two important observations relevant to Frier Levitt’s client base. First, no matter how seemingly insignificant a meal or gift card might be standing alone, if repeated over the course of a relationship, those items collectively may attract the attention of law enforcement. That is all the more so, of course, when the individuals providing the kickback are doing so as part of a broader practice, which was the case here. Hence, regulatory compliance programs should be designed to monitor for patterns over time, not simply keyed to high-dollar transactions or one-time events. Second, this enforcement action serves as a reminder of the very stringent rules around promotional interactions with healthcare professionals, particularly within those states that are far more restrictive than others, including but not limited to New Jersey and Minnesota. Thus, businesses with sales personnel should validate the existence of robust compliance programming, including clear policies, required training for new and existing staff, and monitoring, including ride-alongs where appropriate.
How Frier Levitt Can Help
Frier Levitt not only drafts contracts and agreements between healthcare entities and sales and marketing employees, but assists companies in developing Standard Operating Procedures to ensure compliance with Federal and State laws and regulations. Frier Levitt also offers compliance programming, build-out and support to comply with regulatory requirements, enhance oversight, and mitigate regulatory risk. Contact us today to speak with an attorney.
