Let’s talk about the latest reminder that “everybody’s doing it” is not a defense — especially when “it” is taking disguised kickbacks.
The Department of Justice just announced more than six million dollars in settlements with a former lab CEO, seven marketers, and two physicians. Their alleged wrong? Turning the concept of the “Management Services Organization” into a pay-to-play operation.
Here’s how it worked. The lab’s marketers offered doctors ownership in what looked like investment entities — MSOs — but the profits weren’t tied to management services. They were tied to lab test referrals. Think of it this way: The more blood, the more money you made — oops, I mean the greater your distributions from the MSO.
The DOJ said the CEO kept the scheme running even after internal warnings that the marketers were “a powder keg waiting to explode” and that “people are gonna go to prison.”
The Anti-Kickback Statute doesn’t just cover envelopes of cash — it covers any “remuneration” intended to induce referrals. Rename it, disguise it, or call it a distribution from an LLC — it’s still a kickback if the purpose is to buy business.
This latest round of settlements brings the government’s total haul from similar lab-testing schemes to nearly sixty million dollars, involving about fifty physicians.
The lesson? If you’re offered a “friendly” MSO or “investment opportunity” tied to patient volume, you’re not investing — you’re auditioning for a cameo in a DOJ press release.
Because when it comes to kickbacks, the feds don’t care what you call it. They care what it is.
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