Questionable vendor arrangements, historically, have been scrutinized for placing providers/suppliers at risk of potential administrative sanctions under the Anti-Kickback Statute (AKS).1 In fact, the Office of Inspector General (OIG) issued Advisory Opinion No. 11-11, finding certain vendor arrangements as potentially violative of the AKS, thereby placing the long term care company in question at risk of sanctions.2 Moreover, in light of the passage of the Patient Protection and Affordable Care Act (PPACA) in 2010, long term care companies with suspect vendor arrangements should be aware that the risks now reach well beyond administrative sanctions under the AKS.3 In fact, Section 6402(f) of PPACA expressly amends the AKS to create the potential for a False Claims Act (FCA) action to be instituted based upon a violation of the AKS. Thus, prohibited remuneration, otherwise implicating the AKS, now may expose long term care companies to additional penalties, potential treble damages, and the significant expenses associated with defending against FCA actions even when the government chooses not to intervene.

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