Penalties for Home Health Care Fraud

Healthcare fraud has been estimated by government sources to cost more than $200 billion per year. This astonishing figure would make healthcare fraud among the largest criminal industries in the country by dollar amount if it was a legitimized statistic.

Healthcare fraud is a serious crime that victimizes nearly everyone in the country, directly robbing taxpayers and degrading the ability of America’s healthcare system to deliver top-quality care.

For this reason, various government agencies have been given the green light to pursue all cases of healthcare fraud with every tool in their arsenal and in the most aggressive possible ways. While this necessary enforcement effort is starting to pay off, it has also caught many innocent practitioners in its vortex.

Among the healthcare sectors that have become the focus of anti-fraud law-enforcement efforts, few have been as severely affected as the home healthcare industry, which has historically been plagued by fraudulent activity. Legitimate home healthcare providers need to understand their rights so that innocent mistakes don’t turn into a federal investigation and prosecution.

Penalties for Health Care Fraud are Serious

Some people, including healthcare providers themselves, believe that because home healthcare doesn’t take place in the highly regimented setting of a hospital or practitioner’s office that it is somehow less regulated and a lower-stakes enterprise. In fact, nothing could be further from the truth.

The home healthcare industry is estimated to be worth over $500 billion. The types of care provided by home healthcare personnel are often analogous to the activities conducted in a hospital or other medical facility. For these reasons, all of the laws that govern healthcare fraud in a hospital or office setting also apply to home healthcare providers.

The penalties for health care fraud tend to be at least as heavy as those that are handed down for other types of healthcare fraud. Penalties for home Medicare fraud include prison terms of up to 10 years, blanket fines of up to $250,000, and individual fines of up to $11,000 per instance of fraudulent billing activity. In cases where serious injury or death have occurred consequent to a fraudulent healthcare scheme, prison sentences of up to 20 years can be imposed.

As in most areas of the law, maximum sentences are usually imposed only in the most egregious cases of misconduct. However, other penalties for home healthcare fraud can still be severe. Those who are convicted regularly see sentences of years in prison, as well as crippling fines and restitution imposition.

Even where accused practitioners are able to escape criminal proceedings, the administrative penalties can be potentially worse than jail time. One of the most common administrative penalties for healthcare professionals who are found to have abused their relationship with the Medicare or Medicaid systems is to be barred from future participation in those programs.

For practitioners who operate in low-income areas, this penalty can hit harder than a termination notice. Such decisions are reached with regularly, even in cases where the evidence did not support criminal charges.

In cases of alleged healthcare fraud where financial damage, injury, or death has occurred, regardless of the number of patients involved, investigating agencies may recommend to medical boards that a practitioner’s license be either temporarily suspended or permanently revoked. Such recommendations are nearly always followed, and a license revocation in any U.S. state can make practicing anywhere else far more difficult.

Real-world examples of Penalties for Home Medicare fraud

Federal law allows for draconian sentencing when it comes to nearly any crime involving healthcare fraud.

However, in the real-world, the penalties tend to closely track the severity of the crime as measured in both monetary terms and the level of criminal intent. Medical personnel who deal with Medicare or Medicaid patients should be aware that they are always at high risk of being targeted for an audit or an investigation into potential healthcare fraud.

While this should not be cause for outright paranoia, getting a strong compliance program in place and following it must be a priority for anyone who is a provider of designated health services under Medicare or Medicaid. Around 700 people per year are convicted of healthcare fraud in the United States. Those who operate in cities that the Centers for Medicare and Medicaid Services has deemed as high risk, such as Detroit, Miami, New Orleans and Houston, are all but guaranteed to come under the scrutiny of investigators at some point in their career.

Given these realities, doing everything you possibly can to remain compliant with all relevant statutes, regulations, and procedures while avoiding partaking in anything that could be construed as criminal is imperative.

It’s important to keep in mind that most cases where a defendant is ultimately convicted and sentenced to prison for misconduct stemming from the provision of Medicare-covered healthcare services are the result of unambiguously criminal action. However, this is not always the case. In a country where some states allow convicted murderers to serve less than 10 years, many of the sentences that are handed down in real-world cases of home healthcare fraud are eye opening.

The following cases illustrate the types of penalties that people engaging in fraudulent home healthcare activities have faced at sentencing:

• A Michigan doctor was sentenced to 135 months (more than 11 years) in federal prison for a scheme that defrauded Medicare of more than $8.9 million. The defendant and a number of her co-conspirators were found to have engaged in the systematic falsification of medical records in order to make it appear that nonexistent services had been rendered. The defendant also falsified records in order to make medically unnecessary procedures appear to have been needed. In many cases, the defendant, who was unlicensed at the time, was providing medical services herself to patients while falsifying records to make it appear that a licensed physician had performed them.
• A Houston-area doctor was convicted in a scheme that defrauded Medicare of more than $11 million. The doctor was eventually sentenced to 25 years in federal prison, which means that he will actually serve a minimum of 21 years, a virtual life term for the 64-year-old physician. The complex scheme at the heart of the case involved selling false medical certificates to home healthcare companies, which would then use them to bill Medicare for unnecessary and in many cases nonexistent procedures.
• A Detroit-area owner of a home-healthcare business was sentenced to 84 months in prison and ordered to pay more than $8 million in restitution for a Medicare-fraud scheme that ended up costing the program the same amount. In this case, the owner of the home-healthcare business was convicted of paying illegal kickbacks for patient referrals as well as billing Medicare for services that were not rendered or medically necessary.
• A New Orleans doctor received a sentence of 80 months in prison for her role in falsely certifying thousands of Medicaid patients as being homebound. This opened up the opportunity for more than $50 million in fraudulent Medicare claims through the provision of services that were medically unnecessary.
• A Dallas-area doctor was convicted of one count of conspiracy to commit healthcare fraud and two counts of filing false statements in connection with a healthcare benefit program. The doctor had previously been excluded from the Medicare program but opened a new healthcare clinic through a front. The doctor then went on to submit more than $3 million dollars in claims that were deemed to be medically unnecessary. This resulted in a sentence of 60 months in prison as well as two years of supervised release and restitution of around $3.5 million.
• A New Orleans woman was sentenced to 32 months in prison and ordered to pay $277,000 in restitution. The conviction resulted from a scheme whereby the defendant received kickbacks from a local durable medical equipment supplier for supplying the personal information of Medicare-eligible patients as well as physician signatures prescribing the equipment that the distributor sold. Interestingly, the defendant only personally benefited in the amount of $47,000 throughout the course of the scheme. Still, she will now serve nearly three years behind bars and will face a crushing non-dischargeable debt burden when released.
• The ringleader of the same case that was just described was eventually sentenced to more than 6.5 years in prison for orchestrating the scheme. Her company profited more than $2 million from the fraudulent activity while draining Medicare of nearly $3.5 million in unnecessary costs. She was ordered to pay back the full $2 million in restitution.

This is just a small sampling of the thousands of home Medicare fraud cases that have resulted in convictions and lengthy prison sentences for the perpetrators. While these cases typically involved losses to the government of millions of dollars, similar cases that involve far lesser amounts frequently result in jail terms, in some cases for multiple years.

One thing to note is the jaw-dropping harshness of the maximum sentences authorized by federal healthcare fraud laws. Many defendants in federal cases are convicted of just one count of the law they have violated. This is often enough to bring a sentence of years or decades.

Factors that are likely to lead to serious penalties for Home Healthcare fraud

Reviewing the above cases, it is easy to see a number of patterns emerge. The most salient is that the defendants in those cases all fulfilled the legal elements of fraud.

Different sources give different basic elements of fraud. The simplest version is that a given transaction is fraudulent when the following are true:

• A material misrepresentation of fact is made with the intent to cause loss or injury to another.
• A loss in fact occurs as the result of that material misrepresentation.
• The material misrepresentation is the proximate cause of the loss.

Unlike in civil and administrative cases where sanctions may be imposed upon healthcare providers within the Medicare system on a mere preponderance of the evidence or even the whim of a bureaucrat, when it comes to fraud, the above criteria establish a fairly high burden of proof that the government must meet in order to secure a conviction. However, we can see in the above cases that the same types of unlawful activities that can lead to healthcare providers being audited, investigated, and administratively sanctioned are also the ones that frequently lead to criminal convictions. In many cases, the difference is a matter of the degree of the offense and the quality of evidence available to prosecutors.

In the above examples we see that, on top of heavy administrative and civil penalties, the following actions can lead to defendants being charged and convicted with serious federal offenses:

• Providing services that are medically unnecessary.
• Falsifying medical records in furtherance of receiving unauthorized remuneration from Medicare.
• Billing Medicare for services that were never rendered.
• Paying or receiving kickbacks as a part of patient referral schemes within the Medicare system.
• Billing Medicare for services rendered while not being properly licensed or otherwise authorized to participate in the program.

In short, if you are currently engaging in any of these activities, you should immediately and permanently desist. These are the things that consistently lead to criminal investigations and eventual convictions. Depending on the quality of evidence that the government is able to collect on you, defending against these charges can be very difficult, especially where there is clear fraudulent intent and little ambiguity about what has taken place.

The Healthcare Fraud Group can help you fight Medicare fraud charges

Medicare fraud is perhaps the most serious job-related charge that a medical professional can face because they can result in more prison time than many career criminals receive for violent offenses.

Hiring the right legal defense team as early as possible in your case is absolutely critical in minimizing the fallout. The less guilty you are in actuality, the truer this becomes.

Thousands of innocent healthcare providers each year find themselves in the crosshairs of federal investigators and prosecutors who are trying to bag wins in order to advance their careers. At the Healthcare Fraud Group, our attorneys have worked on both sides of the courtroom. We know how the system works inside and out, and we will use that knowledge in order to anticipate the moves of striving careerist prosecutors. In doing so we will stay one step ahead and thwart their use of trickery that can often induce legally naive defendants to incriminate themselves.

As is always the case with legal matters, getting in contact with a competent and experienced attorney the moment you believe you may be under investigation is paramount. At the Healthcare Fraud Group, our skilled and experienced attorneys can usually make use of the wide-open playing field early in an investigation to steer things towards an acceptable resolution.

However, if our client has already committed numerous errors such as submitting falsified documents, unnecessarily providing too much information, making self-incriminating statements, or stumbling into any number of other pitfalls that law-enforcement professionals are all too adept at creating, the future course of the case narrows and attractive options are lost.

Keeping your case out of the criminal courts is priority one

The Healthcare Fraud Group’s top priority is helping our clients avoid criminal proceedings. In all but the most flagrant violations of the law, limiting the scope of actions against our client to the civil or administrative realm is usually an achievable goal.

One of the most important things, whenever there is even a possibility that you or your practice may currently be under an audit or investigation for home Medicare fraud, is to get a skilled and experienced law firm like the Healthcare Fraud Group involved in the process immediately. It is absolutely crucial to prevent an audit from turning into a criminal investigation and, in turn, a criminal investigation from turning into an indictment.

The Healthcare Fraud Group’s expert attorneys wield many tools to achieve this, from our ability to skillfully guide clients through audits, information requests, subpoenas, and interviews, to our deep knowledge of medical protocols, clinical practice guidelines, and diagnosis-related groups. We are one of the few law firms with real knowledge and first-hand experience in the medical realm. This gives us the expertise and authority to confidently challenge unfounded, weak or unproven assertions from investigators, administrators, and prosecutors, particularly as they relate to medical necessity.

Even in the later stages of a criminal proceeding, when it is likely that serious strategic mistakes have been made on the part of our clients, we can still bring our formidable legal weapons to bear on their behalf. In defending hundreds of clients against potentially life-altering charges, we have a perfect track record of avoiding jail time for any of them.

Unfortunately, such outcomes still cannot be taken for granted, especially for those who fail to retain first-rate legal counsel. The fact is that the enormity of our country’s healthcare-fraud problem has all but given investigators and prosecutors a blank check to go after those who are perceived as costing the program money. This means that corners are often cut, characterizing innocent mistakes as malicious malintent and using aggressive, Gestapo-like tactics to scare non-criminals into incriminating themselves.

Even hardened offenders should never talk to the police without a lawyer present. The reason is that the police are expert interrogators. Even expert criminals are often outplayed by clever detectives who may be playing fast and loose with the suspect’s civil rights. The bottom line is that, even for callous recidivists, the chance of incriminating themselves is too great to proceed without highly skilled legal counsel because what you say will be used against you in court.

Far removed from hardened criminals, our healthcare clients are often hardworking, empathic caregivers and pillars of their communities. If this describes you, do you really think you stand a chance against a professional who’s on a crusade to nail you?

If you believe that you have become the target of a home-healthcare fraud investigation, or if you are facing charges, call now or, contact the Healthcare Fraud Group today. When you’re facing the crushing force of the state, we’re your equalizer.