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New German law combatting corruption in the health sector (June 2016)

  • United Kingdom
  • Germany
  • Health and life sciences

01-06-2016

Prècis

In order to protect the healthcare system against bribery and corruption, Germany has recently introduced a new legislative approach which encompasses a more rigorous and stringent penalisation of all bribery acts in the healthcare industry. The German law combatting corruption in the health sector came into effect in June 2016

The newly introduced criminal offences regarding bribes and corruptive practices aimed at health care professionals, represent a crime punishable by a fine or imprisonment of up to three years not only for the professional, but also for the person attempting to bribe or engage in corrupt practices with a professional, regardless of the health care professional’s working status (employed by a public institution or self-employed).

Background

Bribery and corruption in the pharmaceutical and medical industries has become an important issue due to the significant monetary impact it can have on the public healthcare system. Any investigation regarding bribery and corruption attracts a large media presence and subsequently, negative press for the respective company.

In terms of bribery, there is a difference between bribery in public sector and in private business. In the public sector, the law prohibits both payment to and receipt of bribes by public officials (public bribery, sec. 331 et seqq. German Criminal Code, Strafgesetzbuch, StGB). In the private sector, an employee or agent of a business must not demand or allow himself to be promised consideration, or accept a benefit for himself or another person in a business transaction for affording an unfair preference in the competitive purchase of goods or services (commercial bribery, sec. 299 StGB). The same applies to anyone who offers, promises or grants such persons a benefit in this context.

This distinction between the public and private sector is significant, because in Germany, there are largely two kinds of health care professionals: independent physicians operating within Germany’s public health insurance system (Kassenärzte) and physicians employed in a certain employment with subordinate status, mostly in public owned medical institutions, the so-called public officials (Amtsträger). As such, until now only public officials were seen as legally capable of committing public bribery. There is no criminal penalisation of the Kassenärzte regarding bribery or corruption so far. In 2012, the German Federal Court of Justice (Bundesgerichtshof, BGH) constituted that independent health professionals do not qualify as an employee or an agent under the provisions outlawing commercial bribery (sec. 299 StGB), as they are primarily self-employed (neither being in subordination to an employer nor in an agency relationship) and, thus, cannot commit commercial bribery. Nor do they act as so-called public officials under the laws prohibiting public bribery (sec. 331 et seqq. StGB). Consequently Kassenärzte were not legally capable of committing a crime as a public official.

Following the German Federal Court of Justice‘s decision and in order to defend the healthcare system against bribery and corruption, a more rigorous and stringent penalisation of all bribery acts in the healthcare industry has been initiated and came into effect in June 2016.

What?

On 13 May 2016 the bill on combating corruption in the healthcare sector (Gesetz zur Bekämpfung von Korruption im Gesundheitswesen) passed the Federal Council of Germany. The new law came into effect on 4 June 2016. It contains new criminal offences in sec. 299a and sec. 299b StGB:

§ 299a Corruptibility in health care

Any member of a health care profession requiring state-regulated qualification in order to practice or to hold a professional title who, in connection with the practice of their profession demands, allow himself to be promised, or directly accepts a benefit for themselves or a third person as compensation in return for:

1.the prescription of pharmaceutical products, remedies and adjuvants or medical devices,

2.the procurement of pharmaceutical products or remedies or of medical devices that are intended for direct use by the health care professional or one of his supporting staff, or

3.for the referral of patients or test materials,

for according an unfair preference to another in domestic or foreign competition shall be punished by up to three years’ imprisonment or a fine.

§ 299b Bribery in health care

Whoever offers, promises or grants a member of a health profession in terms of § 299a or a third person in connection with the practice of their profession a benefit as compensation for:

1.the prescription of pharmaceutical products, remedies and adjuvants or medical devices, or

2.the procurement of pharmaceutical products or remedies or of medical devices that are intended for direct use by the health care professional or one of his supporting staff, or for the

3.the referral of patients or test materials,

for the health care professional according an unfair preference to another in domestic or foreign competition shall be punished by up to three years’ imprisonment or a fine.”

In this context and to fight bribery and corruption, some State Chambers of Physicians (Landesärztekammer) have also taken a more stringent approach with regard to benefits given to healthcare professionals by implementing respective provisions into the state professional codes for physicians.

So what?

As consequence of the new legislation, bribes and corruptive practices aimed at healthcare professionals represent a crime punishable by a fine or imprisonment of up to three years not only for the professional (sec. 229a StGB - corruptibility in health care), but also for the person attempting to bribe or engage in corrupt practices with the professional (sec. 229b StGB - bribery in health care). Both provisions refer to members of healthcare professions including both academic health professions (physicians, dentists, veterinarians, pharmacists, non-medical psychotherapists and child and adolescent psychotherapists) and paramedical professions (Gesundheitsfachberufe, e.g. speech therapists, nurses, physiotherapist, physician's assistant). Further, there is no longer a distinction between self-employed physicians and those employed by public institutions with regards to bribery and corruption penalisation. The underlying reason being that the principles of fair competition and the integrity of medical decisions should not be tainted by criminal acts of bribery and corruption.

The new law will ensure companies in the pharmaceutical and medical sector are more diligent in their relationships with physicians, given that a breach of the new provisions has consequences under criminal law. Companies are advised to check whether their agreements, internal guidelines and policies on relationships with health care professionals have to be revised and amended.

Given the above, it is best for any company to avoid the impression that it may influence a healthcare professional in their professional independence in any prescribing, therapeutic and procurement decisions. Therefore, companies must not offer, give, or receive money or any other item of value either as an inducement to make or as a reward for making any decision that is favourable to one’s personal interest or to the company’s corporate interest. Additionally, all fee-for-service agreements must be in writing, approved in advance through the appropriate channels and documented. Agreements (e.g. healthcare professional agreements regarding consultation or other services, agreements regarding external training events, sponsoring agreements) and internal guidelines dated before the changes of the German Criminal Code shall be revised and, if necessary, amended according to the new statutory regulations.

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