Healthcare fraud, a serious offense, involves intentionally deceiving a healthcare system — whether private or government-funded — to obtain unlawful benefits or payments.
These acts, committed by patients, healthcare providers, and other parties within the system, can lead to significant financial losses and severe legal consequences for those accused.
Facing an allegation of healthcare fraud can be an overwhelming experience, as federal and state authorities dedicate substantial resources to investigating and prosecuting these offenses.
Healthcare fraud involves schemes such as upcoding (billing for more costly services than actually provided) and medical identity theft by patients to obtain services or prescriptions using another person's information.
Other prevalent forms include billing for services not delivered, performing unnecessary medical procedures, and falsifying diagnoses or medical records.
Key Takeaways
- Medical identity theft occurs when someone uses another person's medical information to obtain services or prescriptions. It can also involve a provider billing for services by using a patient's identity.
- Doctor shopping involves consulting multiple doctors to get prescriptions for controlled substances, often without revealing the complete medical history to each provider.
- Diversion involves redirecting prescription medications to be used illegally, such as selling them.
- Bogus marketing involves tricking people into providing their insurance details to charge for services that were not provided.
- Upcoding involves billing for a more costly service than what was actually delivered, often by exaggerating the patient's diagnosis to reflect a more severe condition.
- Services not rendered refers to billing for services, supplies, or procedures that were never actually provided to the patient.
- Medically unnecessary services involve performing procedures or tests that are not medically needed, solely to obtain insurance payments.
- Unbundling involves billing for individual parts of a single, comprehensive procedure as if each were a separate service.
- The types of activities covered under the FCA include submitting false claims for government payment, using false statements to obtain government funds, concealing obligations owed to the government, and participating in fraudulent billing schemes.
- Federal pharmacy fraud charges involve illegal actions connected to Controlled Substances Act (CSA) registrations, forged prescriptions, and falsified records. Convictions for these crimes carry severe penalties.
- Under 18 U.S.C. § 1349, merely agreeing to participate in a scheme to defraud a federal health benefit program is a crime known as a healthcare fraud conspiracy.
- Defending against compounding pharmacy TRICARE fraud charges requires careful examination of intent, relevant documentation, and adherence to compliance procedures.
Understanding the different forms of healthcare fraud is a crucial first step for anyone navigating such accusations. Let's review them below.
Healthcare Fraud by Patients
Patients can commit healthcare fraud, often by misrepresenting information to obtain benefits or medications to which they are not entitled. Common examples include:
- Identity Theft: A person knowingly uses another individual's health insurance information to receive medical services, treatments, or prescription drugs.
- Falsifying Information: An individual provides false information on an application for healthcare programs like Medicaid or Medicare to appear eligible for benefits they would not otherwise qualify for. This can include misrepresenting income or disability status.
- Doctor Shopping: A patient visits multiple doctors to obtain several prescriptions for controlled substances without informing the physicians about the other consultations.
- Filing False Claims: A patient files claims for medical services or equipment they never received, or they alter claim forms to receive a higher reimbursement.
- Impersonation: Pretending to be a healthcare professional to offer services or submit billing claims.
Healthcare Fraud by Doctors
Medical professionals are also frequent targets of healthcare fraud investigations. These schemes often involve complex billing practices designed to maximize reimbursements from insurance companies or government programs. Examples of fraud committed by doctors include:
- Upcoding and Unbundling: Upcoding occurs when a provider bills for a more expensive service than the one actually performed. Unbundling involves billing separately for procedures that are typically grouped under a single billing code to increase payment.
- Phantom Billing: A doctor or medical facility bills an insurer for services, tests, or procedures that were never rendered. This can involve billing for appointments that a patient did not attend or for treatments that were not provided.
- Double-billing: Billing the same service more than once, whether to the same insurer or different insurers for identical treatment.
- Performing Unnecessary Procedures: A physician conducts medical procedures or services that are not medically necessary for the patient's condition, solely for the purpose of generating insurance payments.
- Accepting Kickbacks: A doctor accepts money or other benefits in exchange for referring patients to specific clinics, labs, or specialists. This is a direct violation of anti-kickback statutes.
- Falsifying records: Falsifying a patient's medical records or diagnosis to justify unnecessary treatments or procedures.
- Billing for non-covered treatments: Claiming a non-covered treatment, like a cosmetic procedure, as medically necessary to obtain insurance payment.
- Waiving co-pays: Illegally waiving patient co-pays or deductibles and subsequently billing the insurance company for the entire amount.
Under 18 U.S.C. § 1347, charges of health care fraud involving medically unnecessary procedures can result in up to ten years in federal prison per count, with no maximum if the patient was seriously harmed.
Healthcare Fraud by Pharmacists
Pharmacists hold a position of trust and have access to both controlled substances and complex billing systems, creating opportunities for fraudulent activity. Common types of fraud committed by pharmacists include:
- Drug Diversion: A pharmacist illegally diverts controlled substances from the pharmacy's supply for personal use or for sale on the black market.
- Billing for Non-Dispensed Medications: A pharmacy bills an insurance provider or government program for a prescription that was never filled or given to the patient. This can also include billing for a brand-name drug while dispensing a cheaper generic version.
- Short-Filling Prescriptions: A pharmacist intentionally provides a patient with less medication than prescribed but bills the insurer for the full amount.
- Forging or Altering Prescriptions: A pharmacist illegally creates or modifies a prescription to dispense drugs for fraudulent purposes.
Legal Consequences for Healthcare Fraud
Individuals accused of healthcare fraud face prosecution under several powerful federal statutes. The primary laws prosecutors use to file criminal charges include the False Claims Act (FCA), the Anti-Kickback Statute (AKS), and the Stark Law.
Prosecutors may also use broader statutes, such as mail fraud and wire fraud, if the scheme involved using mail services or electronic communications.
Penalties for a conviction can be severe and life-altering. They often include substantial fines, restitution payments to the defrauded parties, and lengthy prison sentences.
Additionally, healthcare professionals face professional sanctions, including the loss of their medical or pharmacy license and exclusion from participating in federal healthcare programs like Medicare and Medicaid.
It's important to note that these penalties can have long-term effects on your personal and professional life, making it crucial to seek legal help as soon as possible.
How a Federal Criminal Defense Attorney Can Help
If you are charged with a federal crime related to healthcare fraud, chances are prosecutors have already developed a solid case against you, creating a high probability of conviction.
The best way to combat these charges is with the help of a skilled federal criminal defense attorney. An experienced attorney can assist in several critical ways:
- Case Assessment: They will review the prosecution's evidence to identify weaknesses, errors, or procedural violations.
- Rights Protection: They ensure your constitutional rights are protected against unlawful searches, seizures, and interrogations throughout the legal process.
- Defense Strategy: They will develop a tailored defense strategy based on the specific facts of your case and relevant laws.
- Negotiation: They can negotiate with prosecutors to potentially reduce or dismiss charges, or to secure a favorable plea agreement when appropriate.
- Courtroom Representation: They will represent you in all court proceedings, challenging the prosecution's evidence and presenting a strong defense.
- Mitigating Consequences: They can provide guidance on managing professional and financial repercussions and work to minimize the long-term impact of the charges.
For more information, contact our federal criminal defense law firm, Eisner Gorin LLP in Los Angeles, CA.
