A substantial part of the revenues generated by Caremark's businesses is derived from third
party payments, insurers, and Medicare and Medicaid reimbursement programs. The latter source of
payments are subject to the terms of the Anti-Referral Payments Law ("ARPL") which prohibits
health care providers from paying any form of remuneration {962} to induce the referral of
Medicare or Medicaid patients. From its inception, Caremark entered into a variety of agreements
with hospitals, physicians, and health care providers for advice and services, as well as distribution
agreements with drug manufacturers, as had its predecessor prior to 1992. Specifically, Caremark
did have a practice of entering into contracts for services (e.g., consultation agreements and research
grants) with physicians at least some of whom prescribed or recommended services or products that
Caremark provided to Medicare recipients and other patients. Such contracts were not prohibited by
the ARPL but they obviously raised a possibility of unlawful "kickbacks.