In a prior post, we discussed the federal anti-kickback statute (the “AKS”) and the implications for ketamine clinics. In short, the federal AKS prohibits anyone from paying or receiving anything of value for the referral of patients where a federal government healthcare payment program is the payor (e.g., Medicare, Medicaid, VA, etc.). 42 U.S.C. § 1320a–7b. While there are many safe harbors that can apply in these situations, one of the fundamental questions is what constitutes a “referral” under the AKS? To help answer and illuminate this question, in 2020, the Seventh Circuit Court of Appeals rendered its decision in Stop Illinois Health Care Fraud, LLC v. Sayeed (No. 12-cv-09306).


Stop Illinois Health Care Fraud, LLC (“Plaintiff”) brought a qui tam action against Management Principles, Inc. (“MPI”) and some of its associates, including its owner and manager, Asif Sayeed, M.D. (“Dr. Sayeed”), as well as the Healthcare Consortium of Illinois (“HCI”, and collectively with MPI and Dr. Sayeed, the “Defendants”). Plaintiff alleged that Defendants had an illegal referral practice that violated the AKS and, by implication, the federal and state False Claims Acts (the “FCA”). After a bench trial, the federal District Court found no violation of the foregoing

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