United States: Seventh Circuit Upholds Physician’s Conviction For Violation Of The Anti-Kickback Law Based On Expansive Definition Of "Referral"

On February 10, 2015, the U.S. Court of Appeals for the Seventh Circuit upheld the conviction of Dr. Kamal Patel for violation of the anti-kickback law, reinforcing a broad definition of "referring" under the statute (U.S. v. Patel, Seventh Circuit Court of Appeals, No. 14-2607, Feb. 10, 2015).

Dr. Patel, a physician who often prescribed home healthcare services to patients, had been convicted of receiving payments from Grand Home Health Care (Grand). After a patient selected a home healthcare provider, Dr. Patel would complete the required paperwork and, if necessary, would recertify the patient for home healthcare. If a patient selected Grand, Dr. Patel would meet with an agent of Grand to sign a certification or recertification. He received cash payments from Grand for each new patient or recertification. Dr. Patel was charged with six counts of violating and one count of conspiring to violate the anti-kickback law. The district court found Dr. Patel guilty on all counts, and sentenced him to eight months in prison, 200 hours of community service and forfeiture of kickback payments.

In his appeal, Dr. Patel argued that he merely provided patients with brochures from several providers offering home healthcare. According to Dr. Patel, he never directed his patients to choose Grand as their home healthcare service provider. As such, he held that he could not be guilty of violating the anti-kickback law, as he had never specifically "referred" patients to Grand. However, the Seventh Circuit rejected this narrow reading of the term "referring," holding that "certifications and recertifications are 'referrals' under the Anti-Kickback Statute." The Court continued by holding that interpreting the term "referring" to cover actions like those of Dr. Patel would serve the main purpose of the anti-kickback law, which is to prevent kickbacks or other "improper financial considerations" from influencing medical judgment.

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