America Court docket of Appeals for the Seventh Circuit lately reversed the conviction of Mark Sorensen, the proprietor of SyMed Inc., a Medicare-registered distributor of sturdy medical gear (DME), for alleged violations of the federal Anti-Kickback Statute (“AKS”). This case, described by the courtroom as one which “checks among the outer boundaries” of the AKS, highlights the excellence between unlawful kickbacks and lawful promoting funds below the AKS.
USA v. Mark Sorensen concerned a enterprise association between Sorensen; PakMed, a DME producer; advertising companies; and a billing company. Collectively, they agreed on a plan to promote orthopedic braces to sufferers. Particularly, the advertising companies printed ads for the braces, and sufferers responded with their medical doctors’ contact info. After accumulating further info and with consent from sufferers, the advertising companies would then fax a prefilled however unsigned prescription kinds to sufferers’ physicians. In what the courtroom deemed “important to [its] determination,” physicians retained discretion to approve or ignore these prescriptions, with almost 80% being declined. If a doctor signed and accredited a prescription, SyMed directed PakMed to ship the braces to sufferers. SyMed billed Medicare for the braces, and paid PakMed a proportion of the funds collected. PakMed then paid the promoting corporations primarily based on the variety of leads that every generated. The Seventh Circuit finally discovered inadequate proof to convict Sorensen below the AKS, discovering that Sorensen’s funds to the advertising companies and producer which promoted the orthopedic braces, didn’t represent unlawful referrals below the statute. The Court docket defined that these companies had been “neither physicians ready to refer their sufferers nor different decisionmakers in positions to ‘leverage fluid, casual energy and affect’ over healthcare choices.” The Court docket additionally emphasised that the physicians retained unbiased judgment in prescribing care. Thus, the Court docket concluded that Sorensen’s funds thus weren’t made for “referring” sufferers inside the which means of the statute. By distinguishing between funds for promoting companies and those who exert undue affect over healthcare choices, the courtroom has set a precedent that underscores the significance of intent in such circumstances.
