Legal Services for Labs and Diagnostic Centers
As a provider for a diagnostic center, you have a higher likelihood to be accused of healthcare fraud. This is because patients are often referred to you by doctors in order to conduct a more thorough study of their health. While your basic services would not normally make you vulnerable to healthcare fraud, if you have any shortcomings in your practice, you might miss that a patient should not have been referred.
While you may think a simple mistake would cause no harm, even a small error can have extreme consequences. Because most, if not all of your patients are paying for services with their insurance coverage, this could make you liable to federal investigations.
Regardless of the reason you are being accused of healthcare fraud, it is important that you are proactive in fighting the case against you. Facing federal charges are more serious than a state or local charges. The penalties involve longer prison sentences and higher fines. Additionally, being charged with, and convicted of federal healthcare fraud can ruin your reputation and lead to you losing any licenses.
No matter how serious the charges against you, now is the time to seek the assistance of an experienced federal criminal defense attorney. While there is likely some assistance provided to you within your organization such as human resources or in-house counsel, those individuals may not have the skills that are needed to successfully defend your case in the federal criminal courts.
What Is Healthcare Fraud?
The Definition Of Healthcare Fraud
Healthcare fraud is:
- the act of committing fraud on a healthcare program;
- either private or public;
- in order to receive some kind of payment or benefit.
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Generally, the law requires that you intend to commit the crime. That does not mean that you need to be aware of the statute, just that your goal was for the crime to occur.
Who Is Harmed By Healthcare Fraud?
When healthcare fraud is committed, it has the ability to affect many different types of people and entities. Your actions can cause physical injury and financial burdens on patients. This is because if someone refers a patient to you and your services are not necessary, yet you still conduct them, they could then get injured. Additionally, they will likely have to pay a cost that was unnecessary.
The government generally faces the largest financial harm. This is because the government has one of the biggest medical coverage programs in the nation.
Like the harm done to the government, private insurance companies are also harmed by healthcare fraud.
Federal Statutes For Healthcare Fraud
You will find that there are numerous statues that can apply to your case if you are under investigation for fraud. This is because you can be prosecuted both criminally and civilly.
Criminal Statutes
Healthcare Fraud 18 U.S.C. § 1347
You might be accused of healthcare fraud if it is alleged that you have tried to defraud a healthcare benefit program in order to receive a benefit or good. For example, you could place an order for a tool or product claiming that you needed it to perform a specific test or diagnostic on a patient. By making this claim, you also lie about their medical condition. As a result, you get federally funded for the tool, but you do not ever use it on the patient.
Anti-Kickback 42 U.S.C. 1320a-7b(b)
As a diagnostic center, you could be charged with violating the anti-kickback statute. You could violate this statute if you accepted a referral to conduct a diagnostic on a patient when the patient did not need the diagnostic, but you did so because of an agreement with another healthcare practitioner.
False Statements in Healthcare Matters 18 U.S.C. § 1035
If part of your responsibilities includes billing patients for services or even filling out patient charts, you could be accused of false statements in healthcare matters. This could happen for various reasons, but the most basic include stating that you conducted a service when you really did not. Another way you could be accused is that you purposely misdiagnosed a patent and lied on their medical record.
Civil Statutes
False Claims Act – 31 U.S.C 3729-3733
Most simply stated, you can be civilly sued for claiming that your provided services to a patient when you did not conduct nor complete any services. A violation of this statute could be as simple as falsely claiming that the number of patients needing MRIs increased, so your use of cleaning supplies went up, and you were required to purchase more.
Physician Self-Referral / Stark Law – 42 U.S.C. 1395nn
The Stark Law is similar to the Anti-Kickback statute above. In civil cases, the instances are somewhat limited as it requires you to have a financial connection to the person you are referring. This can happen if you are married or related to the person whose services you are referring. Additionally, if you are in a partnership, that could qualify as a violation as well.
Under Investigation For Healthcare Fraud?
If you are being accused of healthcare fraud, you might be wondering where the government got their information. Generally, the investigation against you could have started for more than one reason. While some investigations start because of a tip to the government, others could start from different types of audits and investigations.
One of the most basic reasons for the accusations against you is that a patient has informed the government of your actions. This could be because they saw something on their bill that was unnecessary or not provided. In any event, this would lead to an investigation for your actions as a diagnostic center.
Your accusations could also come from an audit. Generally, most insurance providers run audits for the claims that come into their offices. This is to ensure the accountability of these claims and to discover whether they are legal. The company you work for may also conduct a type of internal audit to ensure that fraud is not happening within the building.
An even more thorough and random audit could be one that is conducted by the government. Recently, the government created the Healthcare Fraud Task Force. This task force was created as a result of a spike in healthcare fraud cases.
As a result, numerous teams have been established to discover and investigate healthcare fraud. Part of this task force includes people who comb through data and submissions of claims to determine whether there may be fraudulent activity.
Who Performs The Government Investigations?
Many different government agencies can take part in the investigation. While the Healthcare Task Force is one agency that has offices around the country, it works with many different agencies. One of the major agencies that will likely be involved in your case is the U.S. Department of Health and Human Services (HHS).
HHS would take action in investigating your case both criminally and civilly. It is possible that the FBI is involved in your case. You will likely be investigated by the criminal division of the Department of Justice. In addition to these federal agencies, there is a possibility that state agencies may investigate as well.
Generally, these entities are looking at the types of claims you are submitting. They are looking for patterns and inconsistencies. For example, they could be looking at whether you get referrals from a specific practitioner; or they could look to see if you get referrals for the same type of services.
Additionally, they will be looking for any claims the look flat out incorrect. This could mean that you had a patient go in for an MRI on a specific knee, but then you also completed the MRI on another body part that would not have been included with the knee area.
Should I Make Proactive Steps To Avoid Investigations?
When the government is investigating you, the process will likely take some time. They will be interviewing colleagues, demanding documents, and maybe even try to interview you. While there is not much you can do to change the past, it will be important to think of the actions that led to your investigation and discontinue those actions.
It will be important that you contact a federal criminal defense attorney as soon as possible. While advice at early stages is limited, there is still some advice to give.
A criminal defense attorney can hear what you have to say about your actions and advise whether you should give a statement to government agents. A criminal defense attorney can also reach out to the investigator and/ or prosecutor. Early stages of communication and negotiations can take place that may result in no charges.
Additionally, when you are investigated for these allegations, it will be important to learn what led to the investigation. In the instance that you made some mistake, it will be important that you do not allow for that mistake to happen again. Just because it was an honest mistake the first time, the second time will likely look like your actions were intentional.
Criminal Trial
Generally, the things the government finds when they are investigating your case determine whether you committed a crime. In addition, they are trying to get the evidence needed to prove your guilt. Once they establish the likelihood that you committed a crime, it is likely that they will move forward with the criminal process.
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How Should I Answer Questions When I Am Accused of Fraud?
As mentioned above, when performing an investigation, the purpose is to determine whether a crime was committed and find the evidence to prove that it was. You might think that if you provide a statement, it will show the investigators that you did not commit any crimes. The problem is, you do not always know the crimes that could be applied to your actions.
Once you give a statement to investigators, that statement can be used against you at trial or even for the purposes of punishment if you are found guilty. If you change your statement, both statements can be used against you and the fact that you changed your statement can be used against you.
That is why it is very important to seek the advice of a federal criminal defense attorney before you answer questions. The two of you can discuss your case, and it can be determined whether you should answer questions. Further, if you do decide to answer questions, you will want to have your criminal defense attorney present.
Grand Jury
Once the investigation is complete, the agency will submit the case to the prosecuting agency. The attorney will determine what charges are more appropriate based on the facts of your case. The prosecutor will present these facts to a Grand Jury for a determination of cause.
What Does Probable Cause Mean?
Probable cause is the standard at Grand Jury. The standard is fairly low. A finding of probable cause requires the Grand Jury to find that there is probable cause to believe that a crime has been committed by you.
A Grand Jury generally consists of a presentation of your case to a group of individuals. This will include an explanation of the charges and a description of the facts by a witness. Then, the grand jury will deliberate to determine whether there is probable cause for the charges. If there is probable cause for the charges, the charges will be filed.
Pending Trial
Shortly following filing, the case will be set for a trial date. Prior to trial, your defense attorney will thoroughly investigate the case and interview witnesses. The purpose is to get the best picture of your case. This will help to find a defense for the case against you and to develop a trial strategy. A defense and trial strategy are the ways that you can be found not guilty at trial.
The amount of work will depend on the facts of your case, but in every case, you want an experienced criminal defense attorney who is able to focus on your facts and put in the time and work. Having a federal criminal defense attorney will help in a successful outcome of your case.
Effects Of Healthcare Fraud Involving a Lab or Diagnostic Center
Statutory Penalties
False Claims Act – 31 U.S.C 3729-3733
If you committed fraud under the False Claims Act, you will be issued a fine. Generally, this fine will range from $5,000 to $10,000. The type of fine will var. However, you may get an additional fine based on the damages sustained by the government due to your actions. These are called treble damages, and they will amount to three times the damages sustained by the government.
Physician Self-Referral / Stark Law – 42 U.S.C. 1395nn
If you are found to have committed fraud under the Stark Law, you can receive a fine of up to $15,000 for each type of service that is considered and found to be a violation.
Additionally, if your acts include being involved in a scheme that involves referrals, you will be subject to a fine of up to $10,000 for each of the different arrangements and schemes in which you were involved.
Civil Monetary Penalties Law – related directly to the Anti-Kickback statute 42 U.S.C. 1320a-7b(b) to apply civil penalties to criminal cases.
Criminal Punishment
You will find that the punishment for criminal penalties is far greater than the civil penalties. As you might have assumed, the criminal penalties include both prison and a fine. While a
sentence does not guarantee prison, it is a possibility. The fines are no longer only focused on reimbursement; rather, they are higher fines that are established to punish.
Healthcare Fraud 18 U.S.C. § 1347
The penalty for violating the basic healthcare fraud statute is a term of imprisonment of up to ten years or a fine or both. However, the term of prison time can be raised to up to 20 years if the violation results in serious bodily injury.
Anti-Kickback 42 U.S.C. 1320a-7b(b)
For violating the anti-kick statute, you are subject to up to five years of imprisonment or a fine up to $25,000 or both. These penalties can be applied to each act for which you are convicted.
False statements in healthcare matters, 18 U.S.C. § 1035
If you have been found guilty of making a false statement in healthcare matters, you will be given a fine or five years in prison, or both. The statute itself does not provide a specific dollar amount. Generally, you will be fined according to the amount received by making the false statement(s).
Loss Of License or Certifications
One of the additional penalties, which could be far worse than any fine or a term of prison, is the loss of your certifications. As a medical practitioner, you likely have multiple certifications. The most important is likely your MD. However, if you are also certified to operate a specific type of technology and that has been the basis of your income for the past ten years, the loss of that certification could harm you as well.
Reputational Harm
Another big harm that you will likely face due to a conviction of healthcare fraud is the mark it puts on your reputation. Initially, many people in the medical field and even your friends and family will find out about your healthcare fraud issues. This can cause long term damage to your relationships that may never recover.
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Your Next Step
If you find that you are being investigated or have been charged with healthcare fraud, there are steps you can take to help your case. First and foremost, contact a federal criminal defense attorney, explain your situation, and they can provide you some advice.
Before making any statements, speak with an attorney. If you cannot speak with an attorney, avoid making statements as they could incriminate you.
In being asked to hand over records, continue to be mindful of patient confidentiality. It may be best to wait for a court order requiring you to release and provide documents. If you are not sure, contact a federal criminal defense attorney right away.