HEALTH CARE FRAUD
I. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 773
II. STATUTES ADDRESSING MEDICARE AND MEDICAID FRAUD . . . . . . . . . . . 774
A. False Statement Amendment . . . . . . . . . . . . . . . . . . . . . . . . . 776
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 776
a. Statement or Representation of Material Fact . . . . . . 776
b. False Statement or Representation . . . . . . . . . . . . . . 777
c. Knowing and Willful. . . . . . . . . . . . . . . . . . . . . . . . 777
2. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 778
B. Anti-Kickback Statute . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 779
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 780
a. Knowing and Willful. . . . . . . . . . . . . . . . . . . . . . . . 780
b. Solicitation, Receipt, Payment, or Offer of
Remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 781
c. For the Purpose of Inducing Referral of Business . . . 781
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 782
a. Unconstitutional Vagueness. . . . . . . . . . . . . . . . . . . 782
b. Entrapment by Estoppel . . . . . . . . . . . . . . . . . . . . . 783
c. Good Faith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 783
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 784
4. Safe Harbor Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . 784
a. Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 784
b. Enumerated Safe Harbors . . . . . . . . . . . . . . . . . . . . 785
i. Investment Interest . . . . . . . . . . . . . . . . . . . . 785
ii. Sale of Physician Practices, Practitioner
Recruitment, and Obstetrical Malpractice
Insurance Subsidies . . . . . . . . . . . . . . . . . . . . 787
iii. Contracts for Space, Equipment, Services, and
Employment . . . . . . . . . . . . . . . . . . . . . . . . . 789
iv. Advertisements and Promotions . . . . . . . . . . . 791
v. Electronic Prescription and Health Care Record
Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . 792
vi. Referral Services . . . . . . . . . . . . . . . . . . . . . . 792
vii. Relationships Between Providers . . . . . . . . . . 793
viii. Arrangements Between Providers and Health
Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 794
ix. Relationships Between Providers and Suppliers. . . 795
x. Ambulance Replenishing . . . . . . . . . . . . . . . . 797
xi. January 2021 Safe Harbors . . . . . . . . . . . . . . 798
C. Self-Referral/Stark Amendments . . . . . . . . . . . . . . . . . . . . . . 799
771
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 800
a. Financial Relationship. . . . . . . . . . . . . . . . . . . . . . . 800
b. Referral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 801
c. Submission of a Claim for Services . . . . . . . . . . . . . 801
2. Exceptions and Safe Harbors . . . . . . . . . . . . . . . . . . . . . 801
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 803
D. The Health Insurance Portability and Accountability Act of
1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 803
1. Offenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 805
a. Health Care Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . 806
b. Theft or Embezzlement in Connection with Health
Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 807
c. False Statements Relating to Health Care Matters . . . 807
d. Obstruction of Criminal Investigations of Health Care
Offenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 807
e. Violation of Assignment Terms . . . . . . . . . . . . . . . . 807
2. Corporate Compliance Program . . . . . . . . . . . . . . . . . . . 808
3. Exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 808
4. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 809
E. The Eliminating Kickbacks in Recovery Act of 2018 . . . . . . . . 810
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 810
a. Knowing and Willful. . . . . . . . . . . . . . . . . . . . . . . . 811
b. Solicitation or Receipt of Remuneration . . . . . . . . . . 811
c. Referral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 811
2. Safe Harbor Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . 812
a. Differences from the Anti-Kickback Safe Harbor
Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 812
III. PROSECUTING HEALTH CARE FRAUD WITH GENERAL FEDERAL STATUTES . 813
A. False Claims Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 813
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 814
a. Presentation of a Claim . . . . . . . . . . . . . . . . . . . . . . 814
b. False, Fictitious, or Fraudulent Nature of a Claim . . . 815
c. Intent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 815
d. Materiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 816
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 817
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 818
B. False Statements Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 818
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 818
a. Submission of a Statement. . . . . . . . . . . . . . . . . . . . 818
b. Falsity of Statement . . . . . . . . . . . . . . . . . . . . . . . . 819
c. Materiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 820
d. Intent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 820
772 AMERICAN CRIMINAL LAW REVIEW [Vol. 61:771
e. Statement to a Government Agency . . . . . . . . . . . . . 821
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 821
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 822
C. Mail and Wire Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 822
1. Elements of the Offense . . . . . . . . . . . . . . . . . . . . . . . . . 823
a. Scheme or Artifice to Defraud . . . . . . . . . . . . . . . . . 823
b. Use of the Mails or Wire in Furtherance of the
Scheme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 824
2. Defenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 824
3. Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 824
IV. ENFORCEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 825
A. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 825
B. Federal Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 825
1. Department of Justice. . . . . . . . . . . . . . . . . . . . . . . . . . . 826
2. Department of Health and Human Services . . . . . . . . . . . 827
a. Centers for Medicare and Medicaid Services . . . . . . 827
b. Office of the Inspector General . . . . . . . . . . . . . . . . 827
3. Private Parties and Qui Tam Actions . . . . . . . . . . . . . . . . 829
C. State-Level Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 831
D. Federal and State Cooperation . . . . . . . . . . . . . . . . . . . . . . . 831
E. Compliance Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 832
I. INTRODUCTION
Health care fraud imposes huge costs on society. Accordingly, the government
prosecutes health care fraud with vigor. During FY 2021, the Department of
Justice (“DOJ”) recovered over $5 billion in settlements and judgments in matters
involving the health care industry.
1
Press Release, U.S. Dep’t of Just., Justice Department’s False Claims Act Settlements and Judgments
Exceed $5.6 Billion in Fiscal Year 2021 (Feb. 1, 2022), https://www.justice.gov/opa/pr/justice-department-s-false-
claims-act-settlements-and-judgments-exceed-56-billion-fiscal-year#:�:text¼Recoveries%20in%20Whistleblower
%20Suits,of%20the%20False%20Claims%20Act.
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 2021 11 (2022) [hereinafter HHS ANNUAL REPORT FY21], https://
oig.hhs.gov/publications/docs/hcfac/FY2021-hcfac.pdf.
Individual states assist the HHS Office
of the Inspector General (“OIG”) in initiating and pursuing investigations of
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2024] HEALTH CARE FRAUD 773
