HF 1736

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 01:54am

A bill for an act
relating to health; prohibiting certain provider conflicts of interest; providing
criminal and civil penalties; amending Minnesota Statutes 2008, section 62R.03,
subdivision 3; proposing coding for new law in Minnesota Statutes, chapter 62J;
repealing Minnesota Statutes 2008, sections 13.717, subdivision 3; 62J.23.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [62J.231] MEDICAL PROVIDER KICKBACKS.
new text end

new text begin Subdivision 1. new text end

new text begin Prohibitions. new text end

new text begin It is unlawful for any person to:
new text end

new text begin (1) knowingly and intentionally solicit or receive any remuneration, including any
kickback, bribe, or rebate, directly or indirectly, overtly or covertly, in cash or in kind:
new text end

new text begin (i) in return for referring an individual to a person for the furnishing or arranging for
the furnishing of any health care related item or service; or
new text end

new text begin (ii) in return for purchasing, leasing, ordering, or arranging for or recommending
purchasing, leasing, or ordering any health care related good, facility, service, or item;
new text end

new text begin (2) knowingly and intentionally offer or pay any remuneration, including any
kickback, bribe, or rebate, directly or indirectly, overtly or covertly, in cash or in kind, to
any person to induce the person:
new text end

new text begin (i) to refer an individual to a person for the furnishing or arranging for the furnishing
of any health care related item or service; or
new text end

new text begin (ii) to purchase, lease, order, or arrange for or recommend purchasing, leasing, or
ordering any health care related good, facility, service, or item; or
new text end

new text begin (3) issue a receipt or invoice for medical goods or services containing a false or
misleading statement or make any other misrepresentation or omission with the intent to
conceal the existence of any kickback, bribe, or rebate.
new text end

new text begin Subd. 2. new text end

new text begin Exceptions. new text end

new text begin The following are not prohibited under subdivision 1, clause
(1) or (2):
new text end

new text begin (1) exempt conduct set forth in safe harbor regulations in Code of Federal
Regulations, title 42, section 1001.952, according to United States Code, title 42, section
1320a-7b, paragraph (b), clause (3);
new text end

new text begin (2) rebates paid directly to a consumer in connection with the purchase of
prescription drugs prescribed to that consumer, so long as the rebates otherwise comport
with the requirements of state and federal law and the rebates:
new text end

new text begin (i) are not paid to consumers who are participating in any state or federal health
care program; and
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new text begin (ii) do not exceed the amount paid directly by the consumer for the drug; and
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new text begin (3) prescription drug samples provided to a medical provider, which the medical
provider gives free of charge to a patient, provided that the samples are distributed and
tracked according to state and federal law and drug manufacturers account for the samples
in their price reporting to the federal Medicare program and state Medicaid programs.
new text end

new text begin Subd. 3. new text end

new text begin Definitions. new text end

new text begin As used in this section, "person" means any individual,
corporation, firm, partnership, incorporated and unincorporated association, or any other
legal, professional, or commercial entity.
new text end

new text begin Subd. 4. new text end

new text begin Criminal penalty. new text end

new text begin A person who violates subdivision 1 is guilty of a
felony and may be fined not more than $25,000 or imprisoned for not more than five years.
A prosecution for violation of this section may be brought by the Office of the Attorney
General or any county attorney's office.
new text end

new text begin Subd. 5. new text end

new text begin Civil remedy; commissioner of health. new text end

new text begin The commissioner of health
may investigate any alleged violation of subdivision 1 and may assess a civil fine
against a person who the commissioner determines violates subdivision 1. The amount
of the fine is $1,000 per violation or 110 percent of the estimated financial benefit that
the person realized as a result of the prohibited relationship, whichever is greater. The
commissioner's investigatory powers under this section include, but are not limited to,
the authority to issue subpoenas to require the attendance and testimony of witnesses and
the production of any documents or other information relevant to the investigation. The
subpoenas may be served upon any person anywhere in the state by any person authorized
to serve subpoenas or other processes in civil actions of the district courts. If a person
does not comply with the subpoena, the commissioner may apply to the district court in
any district and the court shall order the person to comply with the subpoena.
new text end

new text begin Subd. 6. new text end

new text begin Civil remedy; attorney general. new text end

new text begin The attorney general may investigate any
alleged violation of subdivision 1 and, having reasonable cause to believe a violation is
imminent, is occurring, or has occurred, the attorney general may institute a court action
seeking appropriate relief. The investigatory authority of the attorney general under this
section shall include, but not be limited to, the authority provided in section 8.31. In
any civil action brought by the attorney general under this section, the court may award
injunctive relief, damages, costs of investigation, reasonable attorney fees, and equitable
relief, including, but not limited to, disgorgement. The attorney general may also sue for
and recover for the state, from any person who is found to have violated this section, a
civil penalty in an amount to be determined by the court, not in excess of $25,000 for
each illegal transaction.
new text end

new text begin Subd. 7. new text end

new text begin Audits of exempt providers. new text end

new text begin The commissioner of health may audit the
referral patterns of providers that qualify for exceptions under the federal Stark Law,
United States Code, title 42, section 1395nn. The commissioner has access to provider
records according to section 144.99, subdivision 2. The commissioner shall report to
the legislature any audit results that reveal a pattern of referrals by a provider for the
furnishing of health services to an entity with which the provider has a direct or indirect
financial relationship.
new text end

Sec. 2.

Minnesota Statutes 2008, section 62R.03, subdivision 3, is amended to read:

Subd. 3.

Health provider cooperatives.

A health provider cooperative shall not
be considered a mutual insurance company under chapter 60A, a health maintenance
organization under chapter 62D, a nonprofit health services corporation under chapter
62C, or a community integrated service network under chapter 62N. A health provider
network shall not be considered to violate any limitations on the corporate practice of
medicine. Health care service contracts under section 62R.06 shall not be considered to
violate section deleted text begin 62J.23 deleted text end new text begin 62J.231 new text end .

Sec. 3. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2008, sections 13.717, subdivision 3; and 62J.23, new text end new text begin are repealed.
new text end