The United States Department of Justice (DOJ) recently announced the sentencing for four healthcare executives. The feds accused these execs of healthcare fraud and money laundering crimes. The allegations stem back a decade and involve claims the four worked together to build a mental health center that profited through the use of kickbacks. These kickbacks, according to the feds, led healthcare providers to send patients to their facility in exchange for monetary gain.
The feds aggressively pursued this case. They built a strong argument against the execs, showing evidence the four often billed Medicare for more expensive acute psychotic episodes when, in reality, the patients were dealing with other, less severe mental health conditions. The prosecution for this case stated these false claims led to over $66 million in fraudulent payments from Medicare. This, paired with the evidence of kickbacks noted above, led the court to dole out hefty prison sentences. The court sentenced one exec to 10 years imprisonment, another four years and the last two just over two years imprisonment.
The severe penalties send a message, loud and clear: the feds are coming after anyone that violates the federal healthcare laws. The government has two tools to use to build a case in these situations, and it uses them well. The first, the AKS, allows the government to move forward with charges against those who knowingly and willfully pay “remuneration” to induce patient referrals or otherwise generate business for a service payable by federal healthcare programs like Medicare. The second, the False Claims Act (FCA), makes it illegal to submit claims to Medicare when the individual or organization making the submission knows or should know are false or fraudulent.
Allegations of a violation of either the AKS or FCA can lead to hefty fines and potential imprisonment. Defenses to these allegations are available. When accused of an AKS violation, for example, there is the possibility that the action in question falls within a safe harbor. This can result in a reduction or even dismissal of charges. As a result, it is important to explore these and other options when facing these charges.