HEALTH CARE FRAUD
I. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 765
II. STATUTES ADDRESSING MEDICARE AND MEDICAID FRAUD. . . . . . . . 766
A. False Statement Amendment . . . . . . . . . . . . . . . . . . . . . . . . . 767
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 767
a. Statement or Representation of Material Fact . . . . . . 768
b. False Statement or Representation . . . . . . . . . . . . . . 768
c. Knowing and Willful. . . . . . . . . . . . . . . . . . . . . . . . 769
2. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 769
B. Anti-Kickback Statute . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 770
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 771
a. Knowing and Willful. . . . . . . . . . . . . . . . . . . . . . . . 771
b. Solicitation, Receipt, Payment, or Offer of
Remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 772
c. For the Purpose of Inducing Referral of Business . . . 772
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 773
a. Unconstitutional Vagueness. . . . . . . . . . . . . . . . . . . 773
b. Entrapment by Estoppel . . . . . . . . . . . . . . . . . . . . . 774
c. Good Faith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 774
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 775
4. Safe-Harbor Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . 775
a. Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 775
b. Enumerated Safe Harbors . . . . . . . . . . . . . . . . . . . . 776
i. Investment Interest . . . . . . . . . . . . . . . . . . . . 776
ii. Sale of Physician Practices, Practitioner
Recruitment, and Obstetrical Malpractice
Insurance Subsidies . . . . . . . . . . . . . . . . . . . . 778
iii. Contracts for Space, Equipment, Services, and
Employment . . . . . . . . . . . . . . . . . . . . . . . . . 779
iv. Advertisements and Promotions . . . . . . . . . . . 781
v. Electronic Prescription and Health Care Record
Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . 782
vi. Referral Services . . . . . . . . . . . . . . . . . . . . . . 782
vii. Relationships Between Providers . . . . . . . . . . 783
viii. Arrangements Between Providers and Health
Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 784
ix. Relationships Between Providers and Suppliers 785
x. Ambulance Replenishing . . . . . . . . . . . . . . . . 787
xi. January 2021 Safe Harbors . . . . . . . . . . . . . . 787
C. Self-Referral/Stark Amendments . . . . . . . . . . . . . . . . . . . . . . 788
763
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 789
a. Financial Relationship. . . . . . . . . . . . . . . . . . . . . . . 789
b. Referral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 790
c. Submission of a Claim for Services . . . . . . . . . . . . . 790
2. Exceptions and Safe Harbors . . . . . . . . . . . . . . . . . . . . . 791
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 792
D. The Health Insurance Portability and Accountability Act of
1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 793
1. Offenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 795
a. Health Care Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . 795
b. Theft or Embezzlement in Connection with Health
Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 796
c. False Statements Relating to Health Care Matters . . . 796
d. Obstruction of Criminal Investigations of Health Care
Offenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 796
2. Corporate Compliance Program . . . . . . . . . . . . . . . . . . . 797
3. Exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 797
4. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 798
E. The Eliminating Kickbacks in Recovery Act of 2018 . . . . . . . . 799
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 799
a. Knowing and Willful. . . . . . . . . . . . . . . . . . . . . . . . 799
b. Solicitation or Receipt of Remuneration . . . . . . . . . . 800
c. Referral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 800
2. Safe Harbor Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . 800
a. Differences from the Anti-Kickback Safe Harbor
Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 801
III. PROSECUTING HEALTH CARE FRAUD WITH GENERAL FEDERAL
STATUTES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 801
A. False Claims Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 802
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 802
a. Presentation of a Claim . . . . . . . . . . . . . . . . . . . . . . 802
b. False, Fictitious, or Fraudulent Nature of a Claim . . . 803
c. Intent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 803
d. Materiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 804
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 804
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 805
B. False Statements Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 805
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 806
a. Submission of a Statement. . . . . . . . . . . . . . . . . . . . 806
b. Falsity of Statement . . . . . . . . . . . . . . . . . . . . . . . . 806
c. Materiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 807
d. Intent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 807
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e. Statement to a Government Agency . . . . . . . . . . . . . 808
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 808
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 809
C. Mail and Wire Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 809
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 810
a. Scheme or Artifice to Defraud . . . . . . . . . . . . . . . . . 810
b. Use of the Mails or Wire in Furtherance of the Scheme 811
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 811
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 811
IV. ENFORCEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 811
A. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 811
B. Federal Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 812
1. Department of Justice. . . . . . . . . . . . . . . . . . . . . . . . . . . 812
2. Department of Health and Human Services . . . . . . . . . . . 813
a. Centers for Medicare and Medicaid Services . . . . . . 813
b. Office of the Inspector General . . . . . . . . . . . . . . . . 814
3. Private Parties and Qui Tam Actions . . . . . . . . . . . . . . . . 815
C. State-Level Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 816
D. Federal and State Cooperation . . . . . . . . . . . . . . . . . . . . . . . 817
E. Compliance Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 818
I. INTRODUCTION
Health care fraud imposes huge costs on society. Accordingly, the government
prosecutes health care fraud with vigor. During FY 2023, the Department of
Justice (“DOJ”) recovered over $1.8 billion in settlements and judgments in mat-
ters involving the health care industry.
1
Press Release, U.S. Dep’t of Just., Justice Department’s False Claims Act Settlements and Judgments
Exceed $2.68 Billion in Fiscal Year 2023 (Feb. 22, 2024), https://www.justice.gov/opa/pr/false-claims-act-
settlements-and-judgments-exceed-268-billion-fiscal-year-2023.
In 2020, the DOJ announced its largest
health care enforcement action to date, which resulted in charges against 345
defendants for over $6 billion in fraud losses.
2
Press Release, U.S. Dep’t of Just., National Health Care Fraud and Opioid Takedown Results in Charges
Against 345 Defendants Responsible for More than $6 Billion in Alleged Fraud Losses (Sept. 30, 2020), https://
www.justice.gov/opa/video/national-health-care-fraud-and-opioid-takedown-results-charges-against-345-
defendants.
Several government agencies are involved in fighting health care fraud. The
DOJ and the Department of Health and Human Services (“HHS”) enforce federal
health care fraud laws and regulations.
3
See DEP’T OF HEALTH AND HUM. SERVS. & DEP’T OF JUST., HEALTH CARE FRAUD AND ABUSE CONTROL
PROGRAM, ANNUAL REPORT FOR FISCAL YEAR 2022, at 12 (2023) [hereinafter HHS ANNUAL REPORT FY22],
https://oig.hhs.gov/publications/docs/hcfac/FY2022-hcfac.pdf.
States assist the HHS Office of the
Inspector General (“OIG”) and the Centers for Medicare and Medicaid (“CMS”)
1.
2.
3.
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