California Prohibits Kickbacks and Fee-Splitting

California law prohibits fee-splitting and kickbacks, but it does allow payments based on fair market value that are not tied to patient volume.
The key is “B&P 650.”
California Business & Professions Code Section 650 states:
(a) Except as provided in Chapter 2.3 (commencing with Section 1400) of Division 2 of the Health and Safety Code, the offer, delivery, receipt, or acceptance by any person licensed under this division or the Chiropractic Initiative Act of any rebate, refund, commission, preference, patronage dividend, discount, or other consideration, whether in the form of money or otherwise, as compensation or inducement for referring patients, clients, or customers to any person, irrespective of any membership, proprietary interest, or co ownership in or with any person to whom these patients, clients, or customers are referred is unlawful
(a) Except as provided in Chapter 2.3 (commencing with Section 1400) of Division 2 of the Health and Safety Code, the offer, delivery, receipt, or acceptance by any person licensed under this division or the Chiropractic Initiative Act of any rebate, refund, commission, preference, patronage dividend, discount, or other consideration, whether in the form of money or otherwise, as compensation or inducement for referring patients, clients, or customers to any person, irrespective of any membership, proprietary interest, or co ownership in or with any person to whom these patients, clients, or customers are referred is unlawful.
(b) The payment or receipt of consideration for services other than the referral of patients which is based on a percentage of gross revenue or similar type of contractual arrangement shall not be unlawful if the consideration is commensurate with the value of the services furnished or with the fair rental value of any premises or equipment leased or provided by the recipient to the payer.
(c) The offer, delivery, receipt, or acceptance of any consideration between a federally qualified health center, as defined in Section 1396d(l)(2)(B) of Title 42 of the United States Code, and any individual or entity providing goods, items, services, donations, loans, or a combination thereof to the health center entity pursuant to a contract, lease, grant, loan, or other agreement, if that agreement contributes to the ability of the health center entity to maintain or increase the availability, or enhance the quality, of services provided to a medically underserved population served by the health center, shall be permitted only to the extent sanctioned or permitted by federal law.
(d) Except as provided in Chapter 2.3 (commencing with Section 1400) of Division 2 of the Health and Safety Code and in Sections 654.1 and 654.2 of this code, it shall not be unlawful for any person licensed under this division to refer a person to any laboratory, pharmacy, clinic (including entities exempt from licensure pursuant to Section 1206 of the Health and Safety Code), or health care facility solely because the licensee has a proprietary interest or co ownership in the laboratory, pharmacy, clinic, or health care facility, provided, however, that the licensee’s return on investment for that proprietary interest or co ownership shall be based upon the amount of the capital investment or proportional ownership of the licensee which ownership interest is not based on the number or value of any patients referred. Any referral excepted under this section shall be unlawful if the prosecutor proves that there was no valid medical need for the referral.
(e) Except as provided in Chapter 2.3 (commencing with Section 1400) of Division 2 of the Health and Safety Code and in Sections 654.1 and 654.2 of this code, it shall not be unlawful to provide non monetary remuneration, in the form of hardware, software, or information technology and training services, as described in subsections (x) and (y) of Section 1001.952 of Title 42 of the Code of Federal Regulations, as amended October 4, 2007, as published in the Federal Register (72 Fed. Reg. 56632 and 56644), and subsequently amended versions.
(f) “Health care facility” means a general acute care hospital, acute psychiatric hospital, skilled nursing facility, intermediate care facility, and any other health facility licensed by the State Department of Public Health under Chapter 2 (commencing with Section 1250) of Division 2 of the Health and Safety Code.
(g) A violation of this section is a public offense and is punishable upon a first conviction by imprisonment in a county jail for not more than one year, or by imprisonment in the state prison, or by a fine not exceeding fifty thousand dollars ($50,000), or by both that imprisonment and fine. A second or subsequent conviction is punishable by imprisonment in the state prison or by imprisonment in the state prison and a fine of fifty thousand dollars ($50,000).
The excepted provision, Cal. Health & Safety Code Section 1400, states:

(a) It is unlawful for any person, association, or corporation to establish, conduct or maintain a referral agency or to refer any person for remuneration to any extended care, skilled nursing home or intermediate care facility or a distinct part of a facility providing extended care, skilled nursing home care, or intermediate care, without first having obtained a written license therefor as provided in this chapter from the director or from an inspection service approved by the director pursuant to Section 1257.
(b) It is unlawful for any person, association, or corporation to establish, conduct, or maintain a referral agency or to refer any person for remuneration to any person or agency outside a long-term health care facility, as defined in Section 1418, for professional services for which the long-term health care facility does not employ a qualified professional person to furnish a specific service, including, but not limited to, laboratory, diagnostic, or therapy services, unless the long-term health care facility complies with current federal and state laws regarding the provision of these services and all of the following conditions are met:
(1) The services will be provided in accordance with professional standards applicable to the provision of these services in a long-term health care facility.
(2) The long-term health care facility assumes responsibility for timeliness of the services.
(3) Services are provided or obtained only when ordered by the attending physician and a notation is made in the resident’s medical chart reflecting that the service has been provided to the resident.

If you have legal questions concerning telemedicine and telehealth practices, or about kickback and fee-splitting legal issues in New York, California, Massachusetts, Washington DC, and other states, contact a lawyer who knows the rules.
Consult an experienced health care law attorney who knows complementary medicine and integrative medicine for legal advice pertaining to any project involving allied health or CAM professionals.
***
Our law office has attorneys with legal experience  in FDA matters, including guiding  clients involved in health care  delivery, group medical and private  medical practice, who are concerned  about issues at the interface of  federal and state law, concerned  about medical board discipline or  medical malpractice liability  issues.  We also review and draft informed  consent forms and guide  clients concerning a variety of health care law  issues.
If you  have legal questions concerning telemedicine and telehealth practices, HIPAA legal issues, health care reform questions, or        other health law matters in New York, California, Massachusetts, Washington DC, and other states, contact a lawyer who     knows the rules.
Consult an experienced  health care law attorney who                  knows     complementary medicine and  integrative    medicine     for       legal     advice     pertaining to any project     involving     allied    health    or CAM     professionals.
***
Healthcare & FDA attorney Michael H. Cohen is a thought leader in healthcare law & FDA law, pioneering legal strategies in healthcare. wellness, and lifestyle markets. As a corporate and transactional lawyer, FDA regulatory attorney who also handles healthcare litigation, healthcare mediation and healthcare arbitration, and international healthcare & wellness law speaker, Los Angeles / Bay Area healthcare & FDA lawyer Michael H. Cohen represents conscious business leaders in a transformational era. Clients seek healthcare & FDA attorney Michael H. Cohen’s legal savvy on all aspects of business law, healthcare law, and FDA law, including:
  
business structure and entity formation (corporations, partnerships, LLCs)
  
health care facility licensing issues (home health agency, hospice, imaging center)
  
practitioner licensing matters;
  
physician and allied & complementary medicine provider employment contracts and independent contractor agreements
  
e-commerce (including online health education and mobile medical apps) legal
  
copyright & trademark, licensing
  
informed consent and liability risk management
  
HIPAA and confidentiality and privacy issues
  
Stark, self-referral, anti-kickback, patient brokering, and fee-splitting questions
  
cosmetics claims, labeling
  
OTC drug & homeopathics FDA legal review
  
medical device FDA legal issues
  
dietary supplement claims and labeling
  
insurance reimbursement and Medicare issues for healthcare practitioners
  
website disclaimers and terms of use
  
concierge medicine legal issues
  
telemedicine legal, m-health, and digital health law
  
business law and health care regulatory compliance arenas
  
healthcare meditation and health care arbitration.
Whether advising start-ups or established companies, Los Angeles / San Francisco / Bay Area healthcare & FDA attorney Michael H. Cohen brings his entrepreneurial spirit and caring insight to cutting-edge legal and regulatory challenges.  The Michael H. Cohen Law Group counsels healthcare practices, entities, and companies, such as clinical laboratories, physicians, psychologists, chiropractors, acupuncturists, naturopaths, nurses, healers, medical spas, sleep centers, addiction treatment centers, surgery centers, anti-aging centers, integrative medicine clinics, anti-aging practices, mental and behavioral health counselors, medical service organizations, telemedicine and mobile (m-health) companies, online health ventures, stem cell and cord blood entities; and other health and wellness enterprises.  Healthcare and FDA lawyer Michael H. Cohen is admitted to practice in California, Massachusetts, New York, and Washington, D.C. Our clientele is national and international, and we also counsel healthcare and FDA clients in Los Angeles, San Diego, Ventura, San Francisco Bay Area, San Jose, Santa Barbara, Sacramento, San Bernardino, Alameda, Contra Costa County, and other California cities and counties.  Contact our Los Angeles, Ventura County, & San Francisco Bay Area FDA & healthcare attorneys today if you need a telemedicine lawyer, concierge medicine lawyer, HIPAA lawyer, FDA lawyer or FDA regulatory consultant (dietary supplements, medical devices, cosmetics, OTC drugs), advertising compliance lawyer, healthcare mediator or arbitrator, concierge medicine attorney, management services organization attorney, or other specialized health care legal advice or FDA regulatory consulting.
Michael H. Cohen Law Group logo
TAGS: General Business
Attorney Michael H. Cohen is a thought leader in business law and health care law, advising clients at the intersection MORE…
Abundance
Abundance Unlimited
Books By Michael
Caribbean
Chiropractic
Clinical Research
Dietary Supplements
Ethical Issues
FAQs
General Business
Health Trends
Hospital Policy
Insurance
International
Licensure and Credentialing
Malpractice and Risk Management
Mental Health Care
Negotiation
New Regulation
Prepaid Legal
Professional Discipline
Resources
Reviews (Books/Films)
Science & Soul
Spa Legal Issues
Spirituality in Healthcare
Yoga
Archives
Enter keywords:


Go
subscribe
ADD THIS BLOG to your feeds or put your email in the box below and hit GO to subscribe by email.

Go
“Abundance Unlimited” Newsletter Signup
Email:
Go
Future Medicine: Ethical Dilemmas, Regulatory Challenges, and Therapeutic Pathways to Health Care and Healing in Human Transformation
Future Medicine: Ethical Dilemmas, Regulatory Challenges, and Therapeutic Pathways to Health Care and Healing in Human Transformation book image Future Medicine by Michael H. Cohen is an investigation into the clinical, legal, ethical, and regulatory changes occurring in our
…More Info
MORE BOOKS BY MICHAEL COHEN
Even More Healthcare Posts at the Michael H Cohen Law Group Healthcare & FDA Law Blog
Physicians and chiropractors navigate functional medicine legal issues
Stem cell therapies engender changing regulatory environment
Acupuncture lawsuits rare but expert witnesses may help
Relationships are transcendental and compelling
HIPAA advanced course offers HIPAA training
Hollywood’s Healer Aiden Chase Hosts Retreat
“Mindwalk” Rocks, Sheds Light on Holistic Health
Past Wife, Past Life
What is the future of Complementary and Alternative Medicine under the Affordable Care Act?
Mediating HealthCare and Other Disputes: Mediation and Healing
A Friend of All Faiths: A Multidimensional Memoir – new review
Empowered Doctor
Docket
Law Firms
Libel
Attorney
Laws
Law School.org
Nutriant
New Doctor
New Lawyer
Therapy Counseling
Fun Shopping
Road to Riches
Attorney Legal Services
CAM Law Offices
Glycadia
Brad Jacobs MD Revolution Health
Alternative Health Practice
LexBlog
The Integrator
Integrative Mental Health
Ariz Family Law
The Whole Child
Gina Smith
Legal Marketing
Netlawblog
Crime and Federalism
Law, Current Events & Culture
Bioethics Blog
Benefits Blog
Employment Law Blog
Laws.com
ADA Title III News & insights – Seyfarth Shaw
Acupuncture Alternative Blog
Advertising & Marketing Lawyer & Attorney – Sheppard Mullin Law Firm
Advertising & Marketing Lawyer & Attorney : Reed Smith Law Firm
Advertising & Media Lawyer & Attorney – Reed Smith Law Firm
Advertising Lawyers & Attorneys – Reed Smith Law Firm
Al-Mirsal (The Messenger) – Latham & Watkins Law Firm
Al-Mirsal: The Messenger (Arabic) – Latham & Watkins Law Firm
Alabama Employment Lawyer & Attorney – Sirote & Permutt Law Firm
Alabama Immigration Law Journal – Balch & Bingham Law Firm
Alabama Injury Law Advisor – Gilmore Law Firm
Alabama Litigation Lawyer & Attorney – Lightfoot Franklin & White
Alcoholic Beverages Law Blog – Stoel Rives Lawyers & Attorneys
Amazing Firms, Amazing Practices – Gerry Riskin
Anticorruption Blog – Squire, Sanders & Dempsey Law Firm
Antitrust Lawyers & Attorneys – Sheppard Mullin
Appellate Lawyers & Attorneys – Sedgwick Detert Moran & Arnold Law Firm
Arizona Criminal Law and Sex Crimes Post – Attorney Vladimir Gagic
Arizona DUI Lawyer & Attorney – Koplow & Patane
Arizona Family Law Lawyer & Attorney – Nirenstein Garnice Soderquist PLC

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s