In a recent development that underscores the importance of compliance with the Anti-Kickback Statute, Admera Health LLC has agreed to pay over $5.5 million to settle allegations of False Claims Act violations. This settlement serves as a crucial reminder for healthcare providers about the severe consequences of violating the Anti-Kickback Statute (AKS)—and the power of whistleblowers to speak up. Two whistleblowers, co-founders of a former third-party marketer for Admera, blew the whistle on the laboratory’s alleged unlawful kickback scheme.

Key Details of the False Claims Act Settlement

According to the allegations, Admera Health, a New Jersey-based company formerly specializing in biopharmaceutical research and clinical laboratory testing, the company made commission-based payments to independent contractor marketers in exchange for recommending or arranging genetic testing services, and then submitting claims for payment for those tests to Medicare and Medicaid.

Understanding the Anti-Kickback Statute Violation

The Anti-Kickback Statute prohibits offering or paying remuneration to induce referrals for items or services covered by federal healthcare programs, including Medicare and Medicaid. According to the settlement, Admera made millions of dollars in commission payments to independent-contractor marketers in exchange for referrals. The payment arrangements were based on the volume and value of genetic testing referrals. Admera allegedly continued these practices even after being informed that such commission payments violated the AKS. Regarding kickbacks, “The law prohibits health care providers, including those that provide laboratory services, from paying kickbacks in the form of commissions to third parties as an inducement to generate business,” said the Principal Deputy Assistant Attorney.

Whistleblower Incentives

As former third-party marketers for Admera, the whistleblowers in this case had an inside perspective to the kickback scheme. The case was brought under the qui tam provisions of the False Claims Act, with the whistleblowers receiving $862,343 or approximately 15.5% of the settlement proceeds.

Conclusion

The Admera Health settlement serves as a stark reminder of the legal and financial risks associated with healthcare fraud. As a healthcare provider, staying informed about such cases and maintaining strict compliance with healthcare regulations is not just a legal obligation but a crucial aspect of maintaining the integrity of the healthcare system. As a marketer or other service provider to a healthcare company, private citizens are empowered by the False Claims Act to report fraud schemes, including violations of the Anti-Kickback Statute, under the qui tam provision. Rooting out kickbacks and other unlawful arrangements is a matter of patient safety: “Kickbacks can negatively influence medical decision making and corrupt the legitimate doctor-patient relationship,” said the Special Agent in Charge of the Department of Health and Human Services Office of Inspector General. Whistleblowers can safeguard both taxpayer dollars and the patients of government-funded healthcare programs.