Written by Zachary Newland, Founding Partner. Last reviewed August 25, 2026.

Anti-Kickback Law: What Healthcare Providers Need to Know About Federal Criminal Exposure

On This Page

• Why the Anti-Kickback Statute Creates Serious Federal Risk
• What the Anti-Kickback Statute Prohibits
• How the Government Proves an AKS Violation
• Anti-Kickback Statute Safe Harbors and Their Limits
• How AKS Violations Differ from Stark Law Violations
• Federal Penalties and Program Exclusion
• What to Do If You Are Under Investigation
• How Evergreen Attorneys Defends Against Anti-Kickback Statute Charges
• Frequently Asked Questions

Why the Anti-Kickback Statute Creates Serious Federal Risk

If you are a physician, practice owner, hospital executive, or healthcare marketer who participates in any federal health care program, the Anti-Kickback Statute is one of the most consequential federal criminal laws you face.

A single compensation arrangement, consulting agreement, or marketing relationship tied to patient referrals can expose you to felony prosecution, years in federal prison, and permanent exclusion from Medicare and Medicaid.

The Department of Justice and the Office of Inspector General at the Department of Health and Human Services (HHS-OIG) actively investigate these arrangements. Investigations often begin with a qui tam complaint, a billing audit, or a subpoena that arrives without warning.

By the time you learn you are a target, the government may have already reviewed years of claims data, emails, and financial records. Understanding what the Anti-Kickback Statute prohibits, how safe harbors work, and what steps to take when contacted by federal investigators is essential to protecting your liberty, your license, and your livelihood.

If you need help with an Anti-Kickback investigation anywhere in the United States, call the Colorado federal criminal investigation team at Evergreen Attorneys today. The best defense is a good offense that starts early.

What the Anti-Kickback Statute Prohibits

The Anti-Kickback Statute, codified at 42 U.S.C. § 1320a-7b(b), is a federal criminal law that makes it illegal to knowingly and willfully offer, pay, solicit, or receive any form of remuneration to induce or reward the referral of patients or the generation of business reimbursable by a federal health care program. “Remuneration” is defined broadly. It includes cash payments, gifts, free or below-market services, lavish entertainment, sham consulting fees, and any other transfer of value designed to influence referral decisions.

The statute is broad. Anti-Kickback covers any compensation related to federal health care programs.

The statute applies to both sides of a kickback arrangement. The person who pays and the person who receives can each face criminal liability. It covers relationships between physicians, hospitals, laboratories, durable medical equipment suppliers, pharmaceutical companies, marketers, and any other individual or entity involved in generating federal health care program claims.

How the Government Proves an AKS Violation

To obtain a conviction under 42 U.S.C. § 1320a-7b(b), the government must prove that the defendant knowingly and willfully offered, paid, solicited, or received remuneration and that at least one purpose of the remuneration was to induce or reward referrals of federal health care program business.

Courts in the Tenth Circuit and elsewhere have applied a “one purpose” test: even if the payment also compensated legitimate services, the statute is violated if inducing referrals was one purpose of the arrangement.

Prosecutors rely on circumstantial evidence, including the correlation between payment amounts and referral volume, the absence of documented fair-market-value analysis, and communications suggesting that the arrangement was designed to reward referrals.

AKS charges frequently appear alongside health care fraud counts under 18 U.S.C. § 1347, creating compounding criminal exposure when kickback-tainted claims are submitted to Medicare or Medicaid.

Anti-Kickback Statute Safe Harbors and Their Limits

HHS-OIG has published regulatory safe harbors at 42 C.F.R. § 1001.952 that identify specific payment and business practices the government will not treat as AKS violations when every element of a safe harbor is satisfied. Common safe harbors cover:

• Space and equipment rental at fair market value with written agreements
• Personal services and management contracts with terms set in advance
• Employment relationships
• Certain discount arrangements
• Investment interests meeting specified thresholds
• Practitioner recruitment in underserved areas

Each safe harbor has precise requirements. A space-rental safe harbor, for example, requires that the agreement be in writing, signed by both parties, specify the covered premises, cover a term of at least one year, set aggregate compensation in advance at fair market value, and not take into account the volume or value of referrals. Failing to meet even one element means the arrangement does not qualify for protection under that safe harbor.

Failing to fit within a safe harbor does not automatically make an arrangement illegal; it means the relationship must be evaluated on its facts under the AKS’s intent standard. However, from a defense perspective, arrangements that fall outside safe harbors face significantly greater scrutiny, and prosecutors will treat the gap as evidence that the parties knew the arrangement was problematic.

OIG advisory opinions provide additional guidance on specific fact patterns, but they protect only the requesting party and cannot be relied upon by others as binding precedent.

OIG advisory opinions are a a starting point, but not the end for a vigorous and thorough federal criminal defense.

How AKS Violations Differ from Stark Law Violations

Providers, executives, and inexperienced defense counsel frequently confuse the Anti-Kickback Statute with the Stark Law (42 U.S.C. § 1395nn), but the two statutes differ in critical ways that affect both exposure and defense strategy.

The AKS is a criminal statute that applies to anyone, including physicians, executives, marketers, and entities, and covers all federal health care programs. It requires proof of knowing and willful intent.

The Stark Law on the other hand is a civil, strict-liability physician self-referral statute that applies only to physicians making referrals for designated health services payable by Medicare or Medicaid. Stark does not require proof of intent; a technical violation of its rules can trigger liability regardless of the parties’ motivations.

In practice, the two laws overlap many times. A compensation arrangement between a hospital and a referring physician that violates Stark may also create AKS risk if any purpose of the compensation was to induce referrals.

When both statutes are implicated, the provider faces potential criminal prosecution under the AKS, civil liability under Stark, and exposure under the Federal False Claims Act for claims tainted by either violation.

Supreme Court Proven Winning Defense Team

Evergreen Attorneys won 9-0 in the U.S. Supreme Court in United States v. Hemani in June 2026, demonstrating the firm’s capability in complex federal criminal matters where statutes intersect and the stakes are at their highest.

Federal Penalties and Program Exclusion

Conviction under the Anti-Kickback Statute carries severe consequences that extend well beyond a prison sentence:

• Up to five years in federal prison per count under 42 U.S.C. § 1320a-7b(b), with enhanced penalties available in certain circumstances
• Criminal fines that can reach $100,000 per violation
• Mandatory exclusion from Medicare, Medicaid, and all federal health care programs under 42 U.S.C. § 1320a-7
• Civil False Claims Act liability
• Loss of professional licensure and hospital privileges

When AKS counts are charged alongside federal health care fraud under 18 U.S.C. § 1347, each health care fraud count carries a potential sentence of up to ten years. The combined exposure for a physician or executive facing multiple counts across both statutes can be decades of imprisonment, millions of dollars in fines and restitution, and permanent destruction of a career.

Program exclusion is often the most devastating collateral consequence. An excluded provider cannot bill any federal health care program, and any entity that employs or contracts with an excluded individual risks its own program participation.

For many providers, exclusion effectively ends the ability to practice.

What to Do If You Are Under Investigation

If you have received a subpoena, a civil investigative demand, a target letter, or a visit from federal agents in connection with your billing relationships or referral arrangements, the steps you take in the first days matter enormously. The following actions can help protect your position:

1. Do not speak with federal agents, OIG investigators, or anyone from the U.S. Attorney’s Office without counsel present. Statements made during an investigation can be used to establish the “knowing and willful” intent element the government needs.
2. Retain a federal criminal defense attorney who handles healthcare fraud and AKS matters before responding to any demand or producing documents.
3. Preserve all records related to the arrangements under scrutiny, including contracts, fair-market-value analyses, board minutes, emails, and payment records. Do not alter, delete, or destroy anything.
4. Identify which of your compensation, referral, consulting, and marketing arrangements may be at issue and gather the documentation that shows how each arrangement was structured.
5. Do not discuss the investigation with business partners, referring physicians, or staff members who may also be subjects or witnesses. These conversations can create additional legal risk.
6. Assess your exposure under related statutes, including 18 U.S.C. § 1347, the False Claims Act, and the Stark Law, so that your defense strategy accounts for the full scope of potential liability.

How Evergreen Attorneys Defends Against Anti-Kickback Statute Charges

Evergreen Attorneys is a federal criminal defense firm that represents physicians, practice owners, hospital executives, DME suppliers, and healthcare organizations facing Anti-Kickback Statute investigations and prosecutions. The firm’s attorneys handle federal healthcare fraud matters from the earliest stages of an investigation through trial and, when necessary, appeal.

Founding Partner Zachary Newland has appeared as counsel of record in more than 130 federal cases since 2016, with a practice focused on federal investigations, white collar crime, and federal trial work. Evergreen Attorneys analyzes compensation and referral relationships for AKS exposure, engages with DOJ and HHS-OIG on behalf of clients during the investigation phase, and develops defense strategies aimed at protecting clients from conviction and other exclusions.

Frequently Asked Questions

What counts as “remuneration” under the Anti-Kickback Statute?

Remuneration under the AKS includes anything of value transferred between parties when one purpose is to induce or reward referrals of federal health care program business. This extends beyond cash to include gifts, free or below-market rent, equipment loans, paid travel, sham consulting arrangements, excessive compensation for minimal services, and marketing fees tied to patient volume.

The government evaluates whether the economic reality of the arrangement, rather than its label, reflects a payment for referrals. This makes the Anti-Kickback law particularly dangerous in the hands of some prosecutors.

Can a provider face AKS charges even if patients received medically necessary care?

Yes. The Anti-Kickback Statute focuses on whether remuneration was exchanged to induce referrals, not on whether the resulting services were medically necessary. A physician who receives kickbacks for referring patients to a particular laboratory can be prosecuted even if every test ordered was clinically appropriate. The government’s theory is always that the kickback corrupted the referral decision itself, regardless of the quality of care delivered.

How do federal investigators typically discover AKS violations?

Investigations often begin with qui tam (whistleblower) complaints filed under the False Claims Act by former employees, billing staff, or competitors. HHS-OIG also initiates investigations based on claims-data analysis that reveals unusual referral patterns, such as a sudden spike in referrals to a single provider or laboratory following a new financial arrangement. Grand jury subpoenas, civil investigative demands, and FBI interviews may follow. Providers sometimes first learn of an investigation when a business partner is subpoenaed or when a federal target letter arrives.

When should a healthcare provider or executive retain federal defense counsel for an AKS matter?

Retain counsel immediately upon receiving any indication that your referral or compensation arrangements are under federal scrutiny. This includes receiving a subpoena, a civil investigative demand, a target letter, a visit from federal agents, or even learning informally that a business partner is cooperating with investigators. Early involvement of experienced federal defense counsel allows you to protect privileged communications, avoid inadvertent admissions, evaluate your safe-harbor compliance, and develop a defense strategy before charges are filed. Waiting until an indictment is returned significantly narrows your options.

If you are facing an Anti-Kickback Statute investigation or federal healthcare fraud charges, contact Evergreen Attorneys at (303) 948-1489 for a confidential case evaluation.