The LA Criminal Defense Attorney is an experienced team of criminal defense attorneys that serves clients in Los Angeles, California. We handle different fraud cases such as healthcare fraud, property fraud, real estate fraud, among other fraud crime cases.
What is Health Care Fraud?
Healthcare fraud is filling out deceitful insurance claims to turn a profit, and such schemes are perpetrated in many forms. The standard healthcare fraud crimes include drug fraud, medical fraud, and insurance fraud, all of which are classified as white-collar crimes. Apart from fraudulent individuals, culprits of healthcare fraud can also be companies aiming to defraud insurance providers or the government through special programs like Medicare. Whenever these crimes happen, the affected entity can claim the money through False Claims Act otherwise known as the Lincoln Law.
Prominent Fraud Schemes
Seeing the long-running issues with US healthcare, the country has grappled with more than its fair of fraudulent schemes. In April 2018, a Las Vegas Medical practice was ordered to pay back $1.5 million of illegal billing accrued from January 1, 2006, to May 31, 2011. The indictment surmised that these charges were apparently for surgical services that were never rendered to the practice's cardiac patients. Furthermore, the clinic also grossly overcharged surgical evaluation and management services.
Another major fraudulent case happened in Illinois where a scrupulous physician stole over $1 million from Medicare and insurance providers after he charged for non-delivered services. More so, the doctor used patients' names – to make claims – without their explicit approval, the Department of Justice noted. This scheme was so elaborate that investigators unearthed an electronic medical record of seven pages about a follow-up examination. Overall, authorities served the physician a 12-count indictment that includes seven counts of healthcare fraud, two counts of aggravated stolen identity, and three counts of making false healthcare statements.
Types of Health Care Fraud
Here are seven kinds of healthcare fraud:
- Billing for Services Not Rendered
This kind of fraudulent scheme is arguably the most common as health providers find it an almost sure route to charge for services that were never given to patients. After examining the patient files, there are no such indications of these procedures, and this raises a red flag. The first line of cross-checking must be the dates; investigators check to see if patients visited the facility on those particular dates shown in insurance claim forms. You can check the appointment calendars, sign-in logs, and just about any record where a staffer indicated something to this regard.
As you can already guess, most providers cannot provide supporting documentation that patients were treated in that facility on those dates. Questioning the affected patients in a calm interview goes a long way in deciphering what is going on, but this approach is not a solid plan. Some patients may have foggy memories due to impairment, others understandably forget details after extended lapses of time, and others could have departed.
Thankfully, most medical practitioners are genuine and would prefer to stay clear of any fraudulent deals. In such cases, it helps to interview current and past employees away from the facilities, so they are comfortable to speak up without looking over their shoulders.
Billing for services that were never rendered is not complicated to unearth so if you are caught up in this predicament; it is expedient to call a defense attorney immediately. Don't answer questions without your legal counsel present as you could inadvertently incriminate yourself.
- Upcoding of Services
As explained above, the status of US healthcare is alarming and even more so when it comes to an understanding of what is and what is not covered by insurance. There are cases where physicians submit claims for services that are yet to be covered by the government or insurance companies. This fraud is accomplished by naming the service or experimental treatment a different name and coding it as such, so it appears to be on the list of covered procedures.
When apprehended, such doctors argue that they were acting in the best interest of their patients – to cure their health problems – and a weak government system should not stand in the way. Upcoding happens because patients are most concerned about getting on the mend and not paying excessive amounts out of pocket, and doctors know this all too well. Unprincipled doctors cover their tracks by indicating more days of treatment so much that it becomes suspicious; who goes to the doctor's office four times a week for allergy treatments?
If you get caught up in this crossfire as the medic in charge or you were following orders, contact a defense attorney who is experienced in handling fraud cases.
- Superfluous Issuance of Prescriptions
On a broader sense, abuse of prescription drugs includes all instances when patients take medicines for reasons that are beyond what was intended by their doctor. For example, taking extra painkillers for back pain regardless of whether prescribed or acquired through unlawful means. This habit is so widespread in America that abusers of prescriptions have doubled from 7.8 million to 15.1 million from 1992 to 2003, the National Center on Addiction and Substance Abuse (CASA) reports. These habits become ingrained, and overdose incidences skyrocket at an alarming rate. What's more, the street value of prescription drugs as compared to the legal price is tenfold which means the market is booming.
‘Doctor shopping' is yet another trick that addicts employ to procure drugs from unwary doctors. Patients or staffers also steal prescription pads and forge a prescription including the doctor's signature. Changing the stipulated quantities and refill numbers is yet another route is taken to get prescriptions for consumption and selling in the black market. CASA also noted that 28.4% of pharmacists failed to double check the prescribing doctor's DEA numbers. This major oversight creates loopholes for patients and medical personnel to steal drugs.
As per requirement prescription claims should be submitted, processed and paid after the full protected identifying information (PII) like the beneficiary's name, insurance policy number, and date of birth are listed on the claim forms. Without a comprehensive PII, the insurance claim cannot be honored. Nevertheless, pharmacists often steal drugs from the inventory then issue requests on the behest of false beneficiaries retrieved from the pharmacy's client database. Some pharmacists are so adept at this that their unlawful actions can go undetected for months if not years. They submit claims indicating reasonable quantities of drugs and charges (e.g., $50 or less) per beneficiary so they appear legitimate and the victims are oblivious since they don't get an explanation of benefits forms. Other pharmacists manipulate original prescription orders or receipts to obtain additional drugs on the side to satiate a drug habit or to keep up supply for underhanded deals.
All caution notwithstanding, these pharmacists run out of luck, and they get caught, or perhaps one of their addict clientele is apprehended and gives them up. Seasoned investigators are keen to detect such patterns including a series of claims involving small dollar amounts as these could be part of a top-dollar scheme defrauding insurers. The list of plausible plots is never-ending, so pharmacy owners and doctors must beware. If you find yourself on either end of such scams, arm yourself with the shrewdest defense attorney. They have sat through hundreds of similar cases, and this expertise will come in handy in mounting an aggressive defense for you.
- Misrepresenting Service Provider
This fraud involves criminals posing as physicians is very scary to imagine, but it happens more often than we care to think. Investigators have dealt with numerous cases where patients attended therapy sessions with mental health professionals who are not fully qualified. While these therapists are licensed, they pretend to have top shelf credentials and sit through meetings then bill for this service at high rates. Insurance companies end up paying an arm and a leg for professionals who don't command those high rates per hour. In most cases, patients requiring therapy or counseling are so distraught with the unfortunate cards they have been dealt with that checking the counselor's credentials is not a priority. They merely want to spill out whatever emotional and psychological issues that are plaguing them, get a prescription, and hopefully resume normalcy sooner than later.
Other despicable cases of fraud occur where untrained therapists treat patients at mental health facilities whose standards are admittedly low. In different scenarios, healthcare facilities hire part-time doctors who sign claim forms and examine treatment documentation. The goal here is to get insurance companies to pay more than they would have if a lesser-qualified doctor had approved the claim forms. These crimes are meticulously organized by facility owners and physicians putting their name on the line is none the wiser. Mainly, they are a scapegoat. If you fall victim to this fraud, find the most qualified defense attorney in Los Angeles to get you off the hook, so you do not wallow in prison unjustifiably.
- Misrepresenting Service Location
Just like other employees, physicians are allowed to take personal time off from the drudge of work and recharge their batteries. Nonetheless, submitting claims that indicate that one was present while they were frolicking on the sandy beaches of Santorini is unbecoming. Assuming that doctors never invite patients to join their luxurious vacations, then such claims are utterly fraudulent and intentionally so! If the proprietor of the facility left another – cheaper doctor – in charge, the claims during this period should reflect as such.
Another way misrepresentation of location ensues is when injections are involved. Patients are given syringes and drugs to manage their ailments at home, but the attending physician goes ahead to bill for this service. What if patients forget proper procedure? What if they have an allergic reaction to the medicine? The situation is dire, but some doctors could not be the least bothered about their client's welfare. You will notice that such claims usually indicate business hours Monday through Friday to make them appear genuine.
- Waiving Deductibles or Co-payments
Contrary to the law, some medical providers waive co-payments and deductibles to increase foot traffic through their doors, only to submit falsified claims to cover the difference. These illegal gains are taken a notch further by indicating bogus services that were supposedly rendered to patients who even don't bother to complain. After all, waiving their deductibles and co-pays means a smaller financial burden for them which is welcome news.
On the surface, it appears that facilities are extending a welcoming hand to patients who cannot afford to meet their medical expenses. In 2014, the New York Times reported that some Americans are so badly off that healthcare issues are pushed to a later date when money is available. Insurance premiums coupled with deductibles and co-pays that are twice the amount of mortgage and grocery expenses are harsh realities faced by families. In its pioneering series dubbed "Paying Till it Hurts," the publication unearthed many insights from its readership. Top of the list was feedback on the affordability - or lack thereof - of care. The majority of those surveyed noted that affording quality healthcare is a ‘hardship' despite the Affordable Care Act. Out of pocket expenses are going up thus deterring people from seeking medical attention when they fall sick.
The above scenario is still playing out in 2019 and providers are finding creative ways of getting patients to seek help. In the end, the government – through programs like Medicare – and insurance companies foot this bill thereby hemorrhaging money which will be offset by raising premiums. As per US law, medical facilities must keep financial records that indicate payments (or not) of additional costs by patients and deductibles. More so, it is imperative that patients keep receipts for every payment made at these facilities and this includes credit card receipts and canceled cheques.
If your medical facility is unable to produce supporting financial documents, you may find yourself being audited for fraud. Investigators will ask to speak to current and past employees, including patients to determine if they have a viable case or not. Having a defense attorney by your side will mitigate the problem before it becomes a bigger issue. The first course of action is deterring investigators from speaking to current staff without a subpoena or combing through your files without a warrant.
Corruption is running rampant in every sector of business and healthcare is no exception. In 2006, Transparency International published a dossier showing the vast scale of corruption in global healthcare, and this resulted in excessive costs to taxpayers in rich and emerging nations. Billions of dollars are siphoned from the estimated $3.1 trillion global expenditure on healthcare, and these stolen funds trickle into private entities. Nevertheless, Transparency International is unable to provide exact figures lost to corruption globally mainly because quantifying fraud in medicine is a near-impossible task. There is no shortage of grey areas like the generous contributions and hospitality that physicians get from Big Pharma that is not always chalked down to bribery.
Here in the US, the gnawing effects of corruption in the healthcare industry have not gone unnoticed as the citizenry grapple with rising costs of quality care and prescriptions. The system is rigged; it is less about healing patients and more about nurturing a money-minting machine. Simultaneous booking of surgeries is proof of this constant hunt for extra income at the expense of patients who are usually oblivious of what is happening behind-the-scenes. Swedish Health in Seattle had an elaborate con going where they knowingly double-booked brain and spine surgeons so they could earn incomes from simultaneous surgeries. These overlapping surgeries meant that surgeons were not present for most of the surgical procedures.
Further, misguided moves by the Trump administration such as downsizing Medicaid and channel those resources to military spending, lower taxes, and building "the wall" are only exacerbating the anguish. For a country that spends one-fifth of its GDP on healthcare, the state of the US healthcare system is a resounding defeat in many fronts: bankrupting patients; killing small enterprises; stagnating wages; and trimming public services at all levels.
To further illustrate how corruption unfolds, providers unabashedly receive payments for referring patients, and this presumably sound business practice is abused. For instance, doctors may refer patients to get X-rays, prescriptions, MRIs. Nonetheless, everything seems above board which makes presenting a case of bribery difficult. Investigators need to show a correlation between "this" (money) for "that" (service), a process that calls for corroborating witnesses. In other instances, bribery is given under the guise of luxurious vacations, hidden gifts, favorable property leasing deals, etc.
If you have received payment the old-fashioned way – under the table – or in a more disguised manner, the charges against you are dire. Find the best defense attorney with a keen focus on fraud cases to guide you on how to navigate the unforgiving Anti-Kickback Statute. The Stark Law applies here as well. It prohibits referring patients to services under financial interests.
Other worthwhile examples of healthcare fraud include the following:
- Overutilization of services
- Duplicating claims
- Inaccurately reporting diagnosis/ procedures
- Giving excessive services,
- Copied and pasted data into patients' files
- Upcoding of items, and so much more.
Penalties for Healthcare Fraud
Healthcare fraud occurs when healthcare workers submit falsified information to the government or private health security plans, so they get compensation. In California, these crimes involving medical care are classified under social security scam laws, and they go by different names including health cover billing fraud, medical insurance fraud, and Medicare fraud.
The prosecuting attorney can only convict you if they prove beyond a reasonable doubt that you participated in any of the above examples of healthcare fraud. They must then prove that you had intentions to defraud the insurance company or government program which means if you inadvertently committed the said crime, you can avoid conviction. Secondly, the prosecutor must prove that you were aware the information you submitted was deceitful or the application papers were meant to falsify a claim.
If you are found guilty, punitive measures will depend on whether the falsified claim amounts to $950 or more. If affirmative, the California Healthcare fraud statutes stipulate misdemeanor charges where you pay legal fees of not more than $1000 or serve a maximum sentence of six months in district jail or both.
If you committed more than one fraud inside a year, their value is computed, and if it reaches $950 or more, this crime is classified as a wobbler and therefore, it can be a misdemeanor or felony depending on circumstances. Misdemeanor charges attract legal fees not exceeding $10,000 and a maximum sentence of 12 months in district jail, or both. Felonies, in contrast, attract a penalty of 2, 3, or 5 years in district jail or a jail sentence of not more than 12 months plus probation. You may also be charged legal fees of twice the amount of healthcare scam or not more than $50,000.
Depending on the gravity of the medical scams, the judge could suspend your license, or you lose it altogether. Such an outcome is likely to hurt your professional reputation. The California Civil statute 550 stipulates that colluding or aiding someone to commit healthcare fraud will attract similar legal actions.
Any cases of fraud in the healthcare industry are not treated lightly, and doctors could even lose their license to practice. As per the Federal Sentencing Guidelines, all instances of healthcare fraud attract charges that start with a base offense level 6 (of 43). Persons who are convicted under the False Claims Act are likely to serve a five-year prison sentence plus hefty fines to the tune of $250,000. The penalties are in response to the Civil Monetary Penalty Law which seeks monetary penalties and exclusion for doctors who defraud the US government.
Moreover, the Exclusion Statute mandates that doctors who contravene the law many times over can no longer participate in Medicare. These statutes come into effect when fraud is detected, and they are pursued by the DOJ, the Office of the Inspector General, and the Department of Health and Human Services. While facing these complex legal entanglements, you assuredly need the best fraud defense attorney in Los Angeles.
Find a Los Angeles Fraud Attorney Near Me
Fraud crimes are among the heavily punished criminal offenses in California. You can lose your professional license as a medical practitioner despite facing other criminal and civil consequences if you are convicted of healthcare fraud. While there are many cases of healthcare fraud, most of these cases don't carry enough evidence to be punished as felonies or criminal offenses at all. In the light of such legal problems, the LA Criminal Defense Attorney is here to help you. We invite you to contact our Los Angeles criminal defense lawyer at 310-933-9439 if you are facing healthcare fraud charges in Los Angeles, California.