Health Care Fraud


State laws on healthcare fraud differ considerably. State healthcare fraud laws typically fall into one of three types; false claims laws, self-referral laws, and anti-kickback laws.

Some states have laws that address all three types of activity, while others may have only one or two, and some may have none at all. In addition to any state prohibitions against health care fraud, federal health fraud law will apply in most situations.

Medicare Fraud

Medicare fraud is obtaining payments from the federal Medicare system by knowingly making false statements or through a scheme to defraud the system of money.

Description: Medicare fraud is typically seen in phantom billing (billing for procedures never performed or for unnecessary procedures), patient billing (a scheme in which the doctor claims to have performed, and the patient claims to have received, treatment that never occurred), and upcoding or unbundling schemes, which inflate bills by using a billing code indicating the need for expensive procedures.

Prohibited Activities

In order to be found guilty or being convicted of Medicare Fraud, the government must prove beyond a reasonable doubt that the defendant:
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Knowingly or willingly executed or attempted to execute;
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A scheme to defraud the Medicare program;
To obtain money or property from that program;
By means of false or fraudulent representations, promises, or pretenses.

Punishment

Medicare fraud is a federal crime with a penalty of up to ten years in prison and a fine. If the violation results in serious bodily injury, the term of imprisonment may be increased to twenty years, and if death results, the defendant may be imprisoned for life. http://www.law.cornell.edu/uscode/text/18/1347

Health Care Fraud

Under 18 U.S.C. § 1347, it is a federal crime to knowingly and willfully execute, or attempt to execute, a scheme or artifice:
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to defraud any health care benefit program; or
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to obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any health care benefit program, in connection with the delivery of or payment for health care benefits, items, or services.
If the violation results in serious bodily injury the punishment may be a fine or imprisonment not more than 20 years, or both; and if the violation results in death, such person shall be fined, or imprisoned for any term of years or for life, or both.

False Statements Related to Health Care Matters

Under 18 U.S.C. § 1035, (a) Whoever, in any matter involving a health care benefit program, knowingly and willfully -- (1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; or (2) makes any materially false, fictitious, or fraudulent statements or representations, or makes or uses any materially false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry, in connection with the delivery of or payment for health care benefits, items, or services, shall be fined her this title or imprisoned not more than 5 years, or both. (b) As used in this section, the term "health care benefit program" has the meaning given such term in section 24(b) of this title.

Theft or Bribery Concerning Programs Receiving Federal Funds

Under 18 U.S.C. § 666: (a) Whoever, if the circumstance described in subsection (b) of this section exists-- (1) being an agent of an organization, or of a State, local or Indian tribal government, or any agency thereof-- (A) embezzles, steals, obtains by fraud, or otherwise without authority knowingly converts to the use of any person other than the rightful owner or intentionally misapplies, property that-- (i) is valued at $5,000 or more, and (ii) is owned by, or is under the care, custody, or control of such organization, government, or agency; or (B) corruptly solicits or demands for the benefit of any person, or accepts or agrees to accept, anything of value from any person, intending to be influenced or rewarded in connection with any business, transaction, or series of transactions of such organization, government, or agency involving anything of value of $5,000 or more; or (2) corruptly gives, offers, or agrees to give anything of value to any person, with intent to influence or reward an agent of an organization or of a State, local or Indian tribal government, or any agency thereof, in connection with any business, transaction, or series of transactions of such organization, government, or agency involving anything of value of $5,000 or more; shall be fined under this title, imprisoned not more than 10 years, or both. (b) The circumstance referred to in subsection (a) of this section is that the organization, government, or agency receives, in any one year period, benefits in excess of $10,000 under a Federal program involving a grant, contract, subsidy, loan, guarantee, insurance, or other form of Federal assistance.

Medicare Anti-Kickback Statute

Under 42 U.S.C. § 1320a-7b(b) and illegal remuneration is found where: (1) whoever knowingly and willfully solicits or receives any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind-- (A) in return for referring an individual to a person for the furnishing or arranging for the furnishing of any item or service for which payment may be made in whole or in part under a Federal health care program, or (B) in return for purchasing, leasing, ordering, or arranging for or recommending purchasing, leasing, or ordering any good, facility, service, or item for which payment may be made in whole or in part under a Federal health care program , shall be guilty of a felony and upon conviction thereof, shall be fined not more than $25,000 or imprisoned for not more than five years, or both. (2) whoever knowingly and willfully offers or pays any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind to any person to induce such person-- (A) to refer an individual to a person for the furnishing or arranging for the furnishing of any item or service for which payment may be made in whole or in part under a Federal health care program, or (B) to purchase, lease, order, or arrange for or recommend purchasing, leasing, or ordering any good, facility, service, or item for which payment may be made in whole or in part under a Federal health care program , shall be guilty of a felony and upon conviction thereof, shall be fined not more than $25,000 or imprisoned for not more than five years, or both . . . . (f) For purposes of this section, the term "Federal health care program" means-- (1) any plan or program that provides health benefits, whether directly, through insurance, or otherwise, which is funded directly, in whole or in part, by the United States Government (other than the health insurance program under chapter 89 of Title 5); or (2) any State health care program, as defined in section 1320a-7(h) of this title.

Theft or Embezzlement in Connection with Health Care

Under 18 U.S.C. § 669: (a) Whoever knowingly and willfully embezzles , steals, or otherwise without authority converts to the use of any person other than the rightful owner, or intentionally misapplies any of the moneys, funds, securities, premiums, credits, property, or other assets of a health care benefit program , shall be fined under this title or imprisoned not more than 10 years, or both; but if the value of such property does not exceed the sum of $100 the defendant shall be fined under this title or imprisoned not more than one year, or both (b) As used in this section, the term "health care benefit program: has the meaning given such term in section 24(b) of this title.

Criminal Penalties For Acts Involving Federal Health Care Programs

Under 42 U.S.C. § 1320a-7b(a)(3)): (a) Making or causing to be made false statements or representations Whoever -- (3) having knowledge of the occurrence of any event affecting (A) his initial or continued right to any such benefit or payment, or (B) the initial or continued right to any such benefit or payment of any other individual in whose behalf he has applied for or is receiving such benefit or payment, conceals or fails to disclose such event with an intent fraudulently to secure such benefit or payment either in a greater amount or quantity than is due or when no such benefit or payment is authorized, shall (I) in the case of such a statement, representation, concealment, failure, or conversion by any person in connection with the furnishing (by that person) of items or services for which payment is or may be made under the program, be guilty of a felony and upon conviction thereof fined not more than $25,000 or imprisoned for not more than five years or both, or (ii) in the case of such a statement, representation, concealment, failure, conversion, or provision of counsel or assistance by any other person, be guilty of a misdemeanor and upon conviction thereof fined not more than $10,000 or imprisoned for not more than one year, or both.
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