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Texas docs tried and sent to prison under novel legal theory

| Apr 2, 2021 | Stark Law/Anti-Kickback Statutes |

The federal government continues its crackdown on illegal kickbacks. Although this is no surprise, the method is a bit surprising. In a recent case out of Texas, the government moved forward with a case against 14 Texans. One of the main laws used to build this case: the federal Travel Act.

What is the federal Travel Act?

This law makes it illegal to travel interstate or use the mail with the intent to distribute proceeds from unlawful activity or otherwise promote or carry on unlawful activity. Lawmakers originally drafted this law to help fight organized crime.

Essentially, this law allows the government to federalize state laws. This is significant because facilities who avoid an Anti-Kickback Statute (AKS) violation by not submitting claims with Medicare could still face federal charges under the Travel Act — as was showcased in this case.

How was it used in this case?

The government built their case against a range of professionals in this case, including managing partners, surgeons, and administrative staff. Overall, the U.S. Attorney for the Northern District of Texas states the group will pay over $82 million in restitution and has sentenced the accused to a total of over 74 years imprisonment.

Two specific examples include a hospital manager who accepted a plea deal, pleading guilty to conspiracy to pay healthcare bribes and commercial bribery. He stated that the group “bought surgeries” and filled out the paperwork so the agreement appeared legit. The prosecution secured a sentence for the manager of more than five years in a federal prison. A managing partner maintained his innocence, but the court found him guilty of ten criminal counts including conspiracy, paying kickbacks, money laundering and commercial bribery. The court sentenced the managing partner to over 12 years imprisonment.

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