Health care fraud enforcement continues to rack up successes.  Prosecutors are employing aggressive investigative techniques and using non-health care fraud related statutes to prosecute individuals. 

At the core of the government’s enforcement strategy is effective interagency collaboration through the Medicare Strike Force and Health Care Fraud Prevention Enforcement and Action Team (HEAT), which consists of representatives from the Department of Justice (DOJ), the Federal Bureau of Investigation (FBI), the Department of Health and Human Services’ Office of the Inspector General (HHS-OIG), and local United States Attorneys’ Offices (USAOs) and Medicaid Fraud Control Units (MFCUs) in health care fraud investigations.  The coordination among these participants has increased and made it far easier for agencies to detect fraud schemes.  One of the more effective tools they use is data mining to identify suspicious billing patterns to find potential fraud.

The Medicare Fraud Strike Force has carried out at least four national takedowns.  The latest was on May 2, 2012, when the Medicare Fraud Strike Force arrested over 100 individuals, including doctors, nurses and other medical professionals for their alleged participation in Medicare fraud schemes involving approximately $452 million in false billing.  The defendants were charged with various health care fraud-related crimes, based on a variety of alleged fraud schemes to submit false claims to Medicare for  medical treatments and services such as home health care, mental health services, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and ambulance services. 

 The government also has adopted a strategy of using non-health care fraud statutes, including mail fraud and wire fraud which are easier to prove and require a lower showing of criminal intent.  The health care fraud statute, 18 U.S.C. § 1347, requires the government to prove that the defendant “knowingly and willfully” executed a scheme or artifice to defraud any health care benefit program.  In contrast, the federal wire fraud statute, 18 U.S.C. § 1343, criminalizes sending by wire any writing by persons who have devised or intend to devise any scheme or artifice to defraud for purposes of executing that scheme. Thus, conviction under this statute does not require proof of criminal intent – only proof that the defendant devised a scheme (or intended to) and sent a message via wire for purposes of executing the scheme. 

The government uses the wire fraud statute for health care cases because the offending providers submit claims and receive payments electronically.  The lower standard of proof gives the government greater leverage over defendants. 

The government also has employed aggressive investigative techniques and prosecution tactics, including execution of search warrants, wiretaps, ambush interviews and undercover officers.  In some cases, prosecutors are successfully detaining defendants without bond pending trial and/or sentencing. 

Health care fraud enforcement typically targets health industries with multi-provider fraud such as DME, home health, and therapy/clinic-related fraud (e.g., physical therapy, occupational therapy, and infusion therapy).  In recent years, the government has expanded its prosecutions to include all participants in a given alleged scheme: patient recruiters who obtain Medicare numbers from beneficiaries; physicians and other licensed health care professionals who use fraudulent provider numbers to bill for unnecessary or never-provided services; and the owners of the companies who allegedly pay fraud facilitators from the gains of the scheme.  Law enforcement agencies are still targeting false front companies, patient recruiters, and other low-hanging fruit in the DME industry.

HHS-OIG has added to the enforcement muscle by using its exclusion authority against health care participants.  Felony criminal convictions related to health care programs result in a mandatory exclusion for a minimum of five years under 42 U.S.C. § 1320a-7(a). Almost half of the exclusions are based on criminal convictions for fraud crimes related to Medicare, Medicaid, or other health care programs.  HHS-OIG has justified requesting longer exclusion periods, and in some cases have sought life long exclusions.

These prosecution trends will continue and watch for even more aggressive tactics in the future.  Health care companies need to prepare and dedicate even more efforts to compliance.