Healthcare fraud investigations can lead to severe penalties, exclusion from federal programs, or prison. Act now to protect your rights. Led by Anthony Mahajan, a former DOJ prosecutor, our team uses insider knowledge to neutralize investigations before they escalate.
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Healthcare Specialty Attorneys and Consultants - Health Law Alliance specializes in healthcare law and is dedicated to defending healthcare providers and their licenses from overreach.
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Frequently Asked Questions About Healthcare Fraud
What should I do if accused of healthcare fraud?
If you’ve been accused of healthcare fraud by CMS or federal agents, taking immediate and decisive action is crucial, so we recommend contacting an experienced health care fraud attorney to represent you. Here are some basic guidelines to help you navigate this challenging situation.
Contact an Experienced Health Care Fraud Attorney: The first and most critical step is to consult with an experienced attorney who specializes in healthcare fraud defense. Hiring the best health care fraud attorney available can make a significant difference in the outcome of your case.
Evaluate Your Options: Federal criminal charges might seem daunting, but it’s important to know that not all healthcare fraud cases go to trial. Many are resolved during the investigative stage. An experienced healthcare fraud attorney will assess your case and determine the best course of action, including a strategy to resolve the matter without charges being filed.
Act Quickly to Mitigate Risks: Speed is essential when dealing with federal investigators or health care fraud auditors. The quicker you act, the better your chances are of avoiding prosecution for health care fraud.
Leverage Legal Expertise to Avoid Prosecution: A skilled healthcare defense attorney has the knowledge and experience to handle healthcare fraud and other investigations effectively. They can often prevent cases from escalating to prosecution by intervening early and negotiating with investigators.
By taking these steps, you maximize your chances of resolving the issue favorably and mitigating federal healthcare fraud penalties.
What types of healthcare cases are the most common?
Healthcare fraud involves a complex web of factors that vary based on whether a matter is civil or criminal. For federal criminal cases, the fundamental elements are contained in 18 U.S.C. 1347, which can apply to:
Understanding these elements is crucial for detecting, preventing, and prosecuting healthcare fraud, ensuring that resources are used appropriately and that patients receive the care they need.
What is federal conspiracy (18 U.S.C. 1349) in healthcare fraud?
Federal conspiracy in healthcare fraud, outlined under 18 U.S.C. 1349, involves collaboration between multiple individuals to execute a fraudulent scheme against the healthcare system. Essentially, it’s when two or more parties agree to commit activities that perpetuate fraud, such as submitting false claims or kickbacks for referrals.
In practical terms, if a health marketer offers unlawful incentives to a doctor to refer patients to a specific pharmacy, and this pharmacy then bills for those referrals, all parties could be charged with conspiracy. The marketer is implicated for offering bribes, the doctor for accepting them, and the pharmacy for generating profits from these illegal referrals.
For defendants facing such charges, it's vital to have skilled legal representation. Firms like Health Law Alliance specialize in dismantling these complex charges. They leverage their expertise to defend clients effectively, offering a viable path to contesting and mitigating conspiracy allegations
What penalties can result from healthcare fraud allegations?
Healthcare fraud allegations can lead to a variety of severe penalties. The type of fraud and the number of violations determine the specific consequences, but the implications can be both business-threatening and life-altering. Here’s what to expect if you come under scrutiny for healthcare fraud:
Understanding these potential penalties highlights the gravity of healthcare fraud allegations and underscores the importance of compliance in healthcare practices.
What are the major types of healthcare fraud and abuse?
Healthcare fraud, waste, and abuse ("FWA") encompass a variety of activities that can result in severe legal consequences for providers, although some types of conduct are more likely to result in charges than others. Here are a few categories of conduct that can result in healthcare fraud investigations or charges:
This is a non-exclusive list, and any type of conduct that results in the submission of a "false" claim to the government or private payor may form the basis for federal healthcare charges.
Who investigates healthcare fraud?
Healthcare fraud is investigated by a variety of state and federal agencies. Key federal agencies include the U.S. Department of Health and Human Services, Office of Inspector General (HHS OIG), Centers for Medicare and Medicaid Services (CMS), and the U.S. Department of Justice (DOJ). These agencies work diligently to identify fraudulent activities within the healthcare system.
Investigative agencies that perform the legwork necessary for complex healthcare fraud investigations include the Federal Bureau of Investigation (FBI), OIG, Internal Revenue Service (IRS), and Drug Enforcement Administration (DEA).
Beyond federal entities, Medicaid Fraud Control Units (MFCUs) operate at the state level to scrutinize state-specific Medicaid fraud cases. Contractors working with CMS, such as Medicare administrative contractors (MACs), recovery audit contractors (RACs), and uniform program integrity contractors (UPICs), audit healthcare providers extensively. Among other contractors, you may be familiar with Noridian, Safeguard Services, or Qlarant.
Furthermore, private insurance companies and benefit managers employ their own Special Investigative Units (SIUs) to ensure participating providers comply with regulations and prevent fraudulent activities. Many healthcare fraud cases are started by a SIU referral to the government.
Speak to an experienced attorney today at no-cost to evaluate your situation and discuss how we can help.
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Healthcare fraud encompasses a wide range of activities, including false claims, kickbacks, and improper billing. These allegations can lead to severe penalties, including fines, exclusion from government programs, and criminal charges. For healthcare providers, the stakes are incredibly high, as even unintentional errors can result in investigations. A strong legal defense is essential to navigate these complex cases and protect your practice.
Healthcare fraud cases are governed by several federal and state laws, each with its own compliance requirements and penalties. The False Claims Act penalizes false or fraudulent claims submitted to government programs, while the Anti-Kickback Statute and Stark Law regulate financial relationships between providers and referral sources. Additionally, HIPAA and various state-specific fraud statutes further complicate the legal landscape. Providers must stay informed about these regulations to reduce their risk of violations.
Providers often face allegations of upcoding, improper billing practices, or violations of referral regulations. Investigations can arise from whistleblower complaints, data analytics, or audits conducted by federal agencies like the DOJ or OIG. Many healthcare practices struggle to prove compliance due to inadequate documentation or misunderstandings of complex billing rules. These challenges can lead to reputational damage and significant financial losses if not handled properly.
The legal process typically begins with an investigation or audit, which may involve subpoenas, Civil Investigative Demands (CIDs), or search warrants. Attorneys work to assess the evidence, develop a defense strategy, and negotiate with government agencies. If the case proceeds, legal representatives advocate for the provider during settlement discussions or in court. Throughout the process, ensuring compliance and maintaining transparent documentation are critical components of the defense.
Healthcare fraud allegations can lead to severe consequences, including substantial fines, exclusion from Medicare and Medicaid, and imprisonment. Providers may also experience reputational harm that affects patient trust and long-term viability. Understanding the potential outcomes underscores the importance of legal representation to mitigate these risks and resolve the matter efficiently.
Our team at Health Law Alliance specializes in defending healthcare providers against fraud allegations. We represent clients during investigations, audits, and court proceedings, ensuring their rights are protected at every stage. By analyzing evidence, preparing robust defense strategies, and negotiating with government agencies, we aim to achieve favorable outcomes for our clients. Additionally, we provide proactive compliance guidance to reduce future risks and help providers maintain their standing in the healthcare industry.
CVS Caremark one of the three major PBMs that control nearly 90% of the market for prescription claims processing.
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Optum is one of three major PBMs that control nearly 90% of the market for prescription claims processing.
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ESI is one of the three major PBMs that control nearly 90% of the market for prescription claims processing.
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Prime has a relationship with ESI that provides for joint provider networks and oversight by both companies.
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Medicare and Medicaid use agencies like OIG or OMIG and outside contractors to audit prescription drug claims.
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Humana is a payor that uses PBMs and other contractors to audit government and commercial drug claims.
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Qlarant is contracted with Medicare to perform fraud, waste, and abuse audits and investigations.
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Safeguard is contracted with Medicare to perform fraud, waste, and abuse audits and investigations.
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To design an effective PBM audit response strategy, providers must understand the chain of events both prior to the initiation of a PBM audit and afterwards. For example, Special Investigative Units (SIUs) are often the genesis of a pharmacy audit, and the presence or absence of "audit risk factors" is informative on potentially broader exposure beyond the claims under audit. Any decision to resolve an audit should be informed and result in a full and final settlement of all liability, but PBM audit settlements need to be structured carefully to achieve this goal.
CVS Caremark, OptumRx, and Express Scripts, control at least 80% of the market, making them the three biggest PBMs. Humana also ranks among the largest. In addition, these PBMs regulate access to networks for smaller competitors, such as ESI's partnership with Prime. Plan sponsors, such as United Health, Cigna and Aetna, are vertically integrated with these PBMs, increasing audit risk for pharmacies because network sanctions are more likely to affect a significant aspect of a pharmacy's business across both government and commercial claims.
PBMs and payors use artificial intelligence and data mining across medical and pharmacy claims to identify areas of potential inquiry. Among other areas, these inquiries typically involve high-reimbursing medicines, brand/generic substitution, inventory discrepancies, co-payment collection, prior authorization, and telehealth relations. Separately, DEA conducts audits and inspections for compliance to controlled substance regulations.
Common types of PBM audits include desk audits; on-site audits; invoice audits; and prescription audits. Irrespective of the type of PBM audit, all interactions with PBMs should be taken extremely seriously and can lead to severe consequences if not handled appropriately. For example, there has been a sharp increase in the federal prosecution of pharmacists for audit-related conduct, including answering PBM questions incorrectly. Accordingly, pharmacies should consider using outside audit counsel to avoid these pitfalls.
Pharmacies can take various steps to prepare to meet PBM audits, including routine self-audits. In fact, the government publishes comprehensive guidance and a checklist to assist pharmacies in their audit planning, including self-audits around prescribing practices, controlled substance management, invoice management, and billing practices. If you need assistance designing or implementing an audit protection plan, please do not hesitate to contact us.
Defending against a PBM audit requires comprehensive knowledge of the rights, responsibilities, and intricacies of pharmacies and their laws and regulations. If your pharmacy has been identified for a PBM audit, there are a number of potential defenses available to you. The first defense against a PBM audit is to be proactive, and audit planning can lessen the chance of unfavorable findings. That said, it is often necessary to involve an attorney to hold PBMs to their obligations under law and provider agreements. For this reason, national audit services and pharmacy audit consultants are often ineffective.
Audit discrepancies and findings can be appealed based on the specific procedures outlined in the provider manuals. It is important to follow these requirements exactly, within the timeframes established, or your appeal rights could be lost and further review denied. In an appeal, it is critically important to make a complete record of why the audit findings or sanctions should be reversed, including through documentation, legal arguments, and corrective actions, if any. Depending on the outcome of the appeal, you may have further legal recourse against the PBM.
PBM audits can have severe repercussions depending on the results of the pharmacy audit, including recoupments, network sanctions, and criminal, civil and administrative investigations involving jail time, significant fines, and license revocation or exclusion. We publish a 10-part PBM Audit Guide that discusses the overlap between PBM audits and government investigations and how to successfully manage audit risk. This resource is complimentary to subscribers HERE.
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