Healthcare regulation enforcement occupied DOJ’s fraud part in 2020

On February 24, 2021, the Fraud Part of the DOJ Legal Division launched its annual year-end abstract (out there right here). The Fraud Part focuses on the prosecution of white collar crime. The report summarizes regulation enforcement actions over the previous yr and examines notable circumstances from the three litigation items of the Fraud Part: (1) the healthcare fraud unit ( HCF); (2) the Overseas Corrupt Practices Act (FCPA) Unit; and (3) the Market Integrity and Main Fraud Unit (MIMF). Summarizing the foremost achievements of the Fraud Part from 2020, the report additionally gives beneficial perception into what lies forward for the Fraud Part in 2021. This text focuses on the healthcare enforcement a part of the Fraud Part report.

Virtually half of the prosecutors within the Fraud Part are assigned to the Healthcare Fraud Unit. The Well being Services Unit’s mission is twofold: to guard federal well being care packages by stopping fraud and abuse; and to guard sufferers, stopping opioid and different drug offenses. In 2020, these objectives translated into three fundamental regulation enforcement priorities: (1) opioids; (2) telemedicine; and (3) COVID-19 fraud. The report additionally gives a statistical abstract of the exercise of the HCF unit in these areas.

Huge Knowledge and Huge Circumstances

The report’s software statistics for 2020 current a transparent message: the HCF unit is concentrating on these concerned in complicated and high-value fraud schemes. In 2020, the whole variety of people charged by the HCF unit decreased (from 344 in 2019 to 167 in 2020). Nevertheless, the common loss per individual billed has nearly doubled (from $ 11.9 million in 2019 to $ 22.6 million in 2020). And, regardless of the decrease variety of complaints, the whole alleged losses had been nearly fixed (from $ 4.11 billion in 2019 to $ 3.77 billion in 2020).

Three observations are price noting. First, the lower within the variety of people charged is probably going the results of COVID-19 – as courts have been closed and grand juries have been suspended, or very restricted, for a lot of the primary half of 2020. Second, l he HCF unit centered on individuals with greater case worth. The DOJ gathers information evaluation to “establish outliers of billing ranges and goal suspicious billing fashions”. Third, in contrast to different fraud part items and native U.S. attorneys’ places of work throughout the nation, the fraud part’s HCF unit didn’t report any company resolutions in 2020.

Quite a few circumstances indicted by the healthcare facility unit in 2020 have been introduced as a part of the Nationwide Well being Care Fraud and Opioid Takedown 2020 (which now we have already mentioned right here). The dismantling included greater than $ 4 billion in telemedicine prices, greater than $ 845 million in “sober home” prices and greater than $ 806 million in prices associated to opioid prescribing and dishing out regimes.


The combat in opposition to opioids stays one of many highest priorities of the Well being Care Services Unit. The report particularly highlights the work of the Appalachian Regional Prescription Opioid Strike Pressure, which targets healthcare professionals and others concerned within the prescribing and distribution of opioids within the Appalachian area, a area significantly affected by the opioid epidemic. Since 2019, the Strike Pressure has introduced prices of unlawful distribution in opposition to 65 licensed medical professionals. These prices sometimes contain alleged conduct effectively exterior the bounds {of professional} medical care: prescribing extreme quantities of opioids, unsafe mixtures, or in change for money or different providers.

The Sober Properties Initiative is a special approach within the combat in opposition to opioids. This coordinated regulation enforcement effort focuses on fraud schemes within the drug therapy trade. Fees on this space contain bribes or kickbacks paid to affected person recruiters, who goal sufferers with personal insurance coverage, and lure these sufferers into the therapy facility. In these packages, recruiters would offer opioids to sufferers (to make sure sufferers qualify for the best degree of therapy), transfer sufferers between a number of services (to maximise their bribes), and even present further unlawful medication between program admissions (to destabilize the affected person’s restoration).


The HCF unit started concentrating on telemedicine fraud in 2019, however because the begin of the COVID-19 pandemic, demand for telemedicine providers has elevated and regulation enforcement has adopted intently. The 2020 withdrawal, for instance, indicted 80 defendants concerned in telemedicine fraud, leading to greater than $ 4 billion in false and fraudulent claims.

In these packages, corporations providing telemedicine providers would pay or present bribes to therapy suppliers. In return, therapy suppliers would order a medically pointless sort of therapy. This might embody sturdy medical gear (eg, wheelchairs or nebulizers), diagnostic exams, or ache medicine prescriptions. Widespread to those patterns, the interplay between the therapy supplier and the affected person is both nonexistent or minimal.

We predict that the combat in opposition to telemedicine fraud will evolve and develop in a post-COVID world, primarily based on two elements. First, reimbursement for telemedicine providers has grow to be rather more broadly out there since March 2020. Second, throughout that very same interval, provider-patient interactions have been nearly totally digital.

COVID-19 Legislation Enforcement

Enforcement of the COVID-19 regulation was the shock of 2020. Continued enforcement on this space in 2021 (and past) ought to come as no shock. Within the report, the HCF unit says it should deal with prosecuting COVID-19 fraud in three areas: (1) check pooling techniques; (2) healthcare know-how securities fraud; and (3) Administration of well being assets and providers fraud (which is the company dealing with reimbursement to suppliers for COVID-19 exams and visits for uninsured sufferers).

The report addresses two circumstances that might signify the tip of the iceberg in healthcare fraud linked to COVID-19. United States v. Mark Schena was the primary felony prosecution for securities fraud linked to COVID-19 (which we beforehand analyzed right here). On this case, Schena would have promoted a medically pointless allergy check with a COVID-19 check that didn’t meet FDA requirements. Schena is awaiting trial.

The second case, United States v. Ashley Hoobler Parris, concerned a check pooling system wherein respiratory pathogen panel exams (which don’t check for COVID-19) had been submitted together with COVID-19 exams for Medicare reimbursement, with the only real function of accelerating charges reimbursement. In November 2020, Parris pleaded responsible to 1 depend of conspiracy to commit healthcare fraud.


In 2020, the Fraud Part’s Healthcare Fraud Unit centered on prosecuting these concerned in opioid, telemedicine and COVID-19 fraud schemes. The DOJ’s use of knowledge analytics was a key side of the HCF unit’s capacity to focus on extra complicated and beneficial fraud schemes than in earlier years. We anticipate these regulation enforcement developments to proceed into 2021. For a extra in-depth evaluation of healthcare enforcement developments over the previous yr, and our tackle what’s coming in 2021, we refer readers to our Well being care software yr 2020 evaluation and outlook for 2021.

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