AMARILLO, TX - Apples and oranges. Venus and Mars. Under the law, there is a huge difference between a W2 employee and a 1099 independent contractor. There is no such thing as a "1099 employee" and there is no such thing as a "W2 independent contractor." Only a human being can be an employee; an "it" cannot be an employee. In other words, while John Smith (a human being) can be an employee, John Smith Marketing Group, LLC (an "it") cannot be an employee. John Smith is either a W2 employee or a 1099 independent contractor—but not both. The 16-year-old-kid that mows my yard on Saturday is a 1099 independent contractor; my secretary (whose office is next to mine) is my employee.
The Medicare anti-kickback statute prohibits offering, paying, soliciting, or receiving any remuneration in exchange for referring (or arranging for the referral of) a patient to a person or entity for any Medicare-covered item or service or in exchange for purchasing, leasing, ordering, or arranging for or recommending purchasing, leasing, or ordering any Medicare-covered item or service. There are both an exception and a safe harbor to the anti-kickback statute that say that it is permissible for a health care provider (such as a DME supplier) to pay commissions to a bona fide full-time or part-time W2 employee. The reasoning behind this exception is because the supplier has the obligation to supervise and control its employee, and the supplier is liable for the acts of its employee. See more at: http://www.medtrade.com/news/general-healthcare/Do-Not-Pay-Commissio-1646.shtml#sthash.dEWNil6A.dpuf
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