On May 23, 2025, the Minnesota enacted a state-law analog to the federal Anti-Kickback Statute (AKS) under the state’s criminal code.
Although the imposition of a kickback prohibition in Minnesota is unlikely to change the day-to-day operations of health care entities, it does increase the risks associated with giving or receiving anything of value in exchange for the referral of patients whose claims for items or services are reimbursable by a federal health care program or a Minnesota health care program including the Minnesota Behavioral Health Program and the Minnesota child care assistance program.
Notably, the new statute does not apply to services or items reimbursed by commercial payors.
Unauthorized Remuneration
Effective August 1, 2025, Minn. Stat. Ann. § 609.542 makes it a crime to intentionally solicit, receive, offer, or provide money, discounts, credits, waivers, rebates, goods, services, employment, or anything else of value in exchange for:
• Referrals for furnishing or arranging any item or service payable by federal or state health care programs.
• Purchasing, leasing, ordering, or recommending any good, facility, service, or item payable by federal or state health care programs.
• Applying for or receiving any item or service payable by federal or state health care programs.
Criminal Penalties
Violations can lead to the imposition of fines and imprisonment based on the value of the kickback:
- Over $35,000: Up to 20 years’ imprisonment, $100,000 fine, or both.
- $5,000 to $35,000: Up to 10 years’ imprisonment, $20,000 fine, or both.
- Under $5,000: Up to 5 years’ imprisonment, $10,000 fine, or both.
Exceptions
Section 609.542 incorporates by reference the safe harbors to the federal AKS under 42 C.F.R. 1001.952 and exemptions under 42 U.S.C. § 1320a-7b(b)(3).
In addition, the following are not considered to be unauthorized remuneration:
- Money given by an employer to an employee for providing items or services payable by the state child care assistance program under Chapter 142E.
- Child care discounts, scholarships, or other financial assistance to families so long as doing so is permitted under the state child care assistance program under Section 142E.07.
Additional Considerations
Aggregating the value of the kickback
When determining the value of the kickback, prosecutors are permitted to aggregate “any money, discount, credit, waiver, rebate, good, service, employment, or other item of value solicited, received, offered, or provided within a six-month period.” It is unclear whether the prosecutor has discretion to determine which six-month period to use.
Intentional action
While the federal AKS requires proof that a defendant “knowingly and willfully” engage in the unlawful conduct, Section 609.542 requires only an “intentional” action. It is unclear whether Minnesota prosecutors and courts will view the intentional requirement in Section 609.542 to be a lower threshold than that of the federal AKS under the plain text of the statute or if they will attribute the intentional requirement under the AKS to Section 609.542. If they apply a lower threshold of intent to act, rather than intent to commit a wrongful act, it is possible that we will see an increase in kickback and false claims enforcement in Minnesota.
False claims
The potential risk of a kickback extends beyond the penalties in the statute. Similar to the federal AKS, claims submitted as a result of a kickback in violation of Section 609.542 constitute false or fraudulent claims under Section 15C.02 and are subject to its penalties. Minnesota courts’ interpretation may be influenced by federal litigation and the ongoing circuit split over whether causation standards apply if a claim was submitted as a result of a kickback.
Takeaway
While the new statute may not alter daily operations for most health care entities, it increases enforcement risk. Entities should review compliance policies and monitor developments in enforcement and related false claims litigation.
AlstonHealth State Law Hub
Alston & Bird’s Health Care team highlights state legislation and regulatory actions with direct implications for operations, reimbursement, privacy, and enforcement risk. Designed for in-house counsel, the tracker supports legal teams in proactively managing risk and aligning business strategy with a rapidly evolving state regulatory environment.
Learn more on the AlstonHealth State Law Hub.
If you have any questions, or would like additional information, please contact one of the attorneys on our Health Care team.
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