Legal Summary

The Basic Anatomy Of A Government Investigation and How Providers Can Be Proactive

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Health care providers are increasingly facing criminal prosecution for fraud-related crimes. Providers should be prepared to navigate the treacherous waters of a government investigation. A lack of preparation or adequate response to a government investigation may expose a provider to incarceration, significant financial penalties and exclusion from federal, state, and other insurance programs. Accordingly, providers must understand the process of government investigations and take a pro-active approach to prepare for any potential investigation. Most health care fraud charges relate to a provider making a false statement in order to induce reimbursement by a government benefits program such as Medicare or Tricare for a service that is not entitled to payment under Program rules. The most commonly prosecuted misstatements include: the medical necessity of a service; that the billing submission is not related to violations of Program rules such as the anti- kickback provisions; that the service was performed when, in fact, it was not; upcoding, etc. In general, these prosecutions involve a substantial pattern of conduct and can implicate staggering loss amounts.

In order to obtain a conviction for health care fraud, the government must prove that the provider intended to mislead the benefits program through the false statement. Intent is usually the most difficult element for the government to prove. Testimony by alleged “co-conspirators” or former employees who know the provider’s practice and who hear the provider’s conversations are the most common and compelling evidence in these cases. A provider’s most trusted employees can accordingly become essential witnesses in a health care fraud prosecution.

A government investigation can be sparked in different ways. A competitor, disgruntled employee or patient might contact law enforcement. An unusual pattern in billing submissions can alert the benefit administrator to misconduct, or a cooperating witness to a separate investigation might provide information as part of their assistance to law enforcement. Regardless of how it commences, once the government receives information about a possible violation of law, a full-blown investigation can be commenced that might lead to a criminal prosecution and/or a potentially costly civil lawsuit under the False Claims Act.

Once a federal investigation has been initiated, agents are assigned to investigate. These agents may come from different government agencies such as the Federal Bureau of Investigation (FBI), the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG), the Centers for Medicare & Medicaid Services (CMS), Drug Enforcement Administration (DEA), Defense Criminal Investigative Service (DCIS), Federal Deposit Insurance Corporation Office of the Inspector General (FDIC-OIG), Internal Revenue Service (IRS) or another agency. These agencies often coordinate their efforts.

A provider will most often learn that he or she is under investigation when his or her employee advises that agents approached them after hours asking questions about the provider’s practice. This surprise approach is designed to obtain as much information as possible from a nervous and

off-guard witness. If the employee is not properly prepared, they will be intimidated and agree to talk to the agents without understanding that t hey are not legally required to do so and might, in fact, be also incriminating themselves.

Providers should take some control of the investigation

There are ways that a provider can protect themselves and their practices prior to the commencement of any investigation. The first and most important step is for providers to seek the advice of attorneys with experience in government investigations to prevent any unintentional missteps and to avoid any perception by the government that they are attempting to obstruct justice or tamper with potential witnesses. Below are four key events that require a plan of action by providers and their employees:

1. Government approaches a

provider’s employee: Employees should be trained in the normal course of business on how to respond if government agents approach them inquiring about the provider’s practice. Employees should be informed about their rights and given guidance as to their options. An employee has a right to speak to a government agent if he or she knowingly and willingly chooses to do so. An employee also has a right to decline to speak to an agent.

For instance, if agents approach an employee, and the employee willingly chooses not to speak with the agent, the employee can decline and politely ask for the agents’ business card. The employee can also tell the agent that an attorney will call them as soon as possible. The employee should notify the provider about the encounter and the provider should immediately contact an attorney who has experience in government prosecutions.

Some agencies have a right to access a provider’s books and records and can demand to inspect those items on the spot. Having access to the records does not mean that the employees must agree to be interviewed, however. Employees should receive proactive guidance related to how the office should proceed under such circumstances. This will alleviate the employee’s anxieties and provide them with a proper plan of action that might avoid unwanted disclosures.

2. Search Warrants: A search warrant is a document signed by a judge after determining that there is probable cause to believe that a crime was committed, and that evidence of such crime is located at a target location. It allows the government to enter and search the target location without permission by the owner/lessor to look for and seize the evidence of the enunciated crime during specific times and dates. The execution of a search warrant can be frightening.

Usually, a search warrant squad descends on a practice with no advanced warning carrying badges, guns, and bullet proof vests. This surprise tactic is designed to prevent destruction of evidence by the provider, to secure the target location, and to intimidate. Such an event can cause tremendous disruption in the workplace and rattle employees and patients. Employees should be informed in advance as to what a search warrant is, what the government might do while executing a search warrant, and the employees’ roles and rights during such an occurrence. Additionally, the office should have a plan in place that designates an employee to act as a point person upon the execution of a search warrant. That employee should be given guidance about the steps that should be taken, including:

a. Accepting the search warrant and reviewing it to make sure all pages are included;

b. Immediately notifying the provider and the practice’s attorney and sending each a copy of the warrant;

c. Reading the warrant carefully to make sure that the search takes place in the location and at the times authorized in the warrant and that the items seized are those also specifically authorized in the warrant.

d. Asking the agents to wait until the provider’s attorney is called but if the agents refuse, the employee should not do anything that is perceived to obstruct the search.

Execution of search warrants are chaotic and frightening. A full explanation of how the government conducts search warrants and a plan

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From Page 29 of action for the employees will turn a chaotic situation into one where the provider and employees will feel more in control.

3. Subpoenas: A subpoena is a court document ordering the recipient to appear in court or before a grand jury to testify. A subpoena duces tecum is a court document ordering the recipient to produce specified documents to the Grand Jury or at trial. At times, a subpoena orders both the production of specified documents and the attendance at a court or grand jury proceeding.

When being served with a subpoena, an employee should immediately provide the subpoena to the provider who should in turn immediately contact their attorney to plan a response. There are multiple basis to object to subpoenas that are drafted poorly, including over-breadth and/ or vagueness.

Additionally, certain documents can be withheld from production, including those protected by the attorney-client privilege. All of this must be explored with an attorney.

4.Civil Investigative Demand

(“CID”): A CID is an administrative subpoena issued by a government agency, such as the U.S. Department of Health and Human Services Office of Inspector General, demanding the provider to produce certain documents. The government issues

CIDs when investigating a civil matter and before a civil complaint is filed.

Although an investigation may start as a civil matter, it can turn into a criminal case. Therefore, receipt of a CID should be taken seriously and responded to carefully.

Navigating a government investigation is very complex and full of potential traps. Most health care providers and their employees have had no prior contact with criminal investigators. They also believe they have done nothing wrong and have nothing to hide. Without proper preparation, they often hand the government key evidence that can result in a criminal prosecution and conviction. Likewise, inadequate preparation with knowledgeable counsel may cause a provider and his or her employees to take actions that could subject them to additional charges such as making false statements, tampering with witnesses and/or obstruction of justice. Providers are thus exposed to staggering financial liability, exclusion from practice and federal programs and decades of incarceration when ill-prepared. Because of the potentially dire consequences inherent in a government investigation, providers and their employees should be prepared to respond to a government investigation properly and under the guidance of a qualified attorney.

DISCLAIMER: This article is for information only and should not be considered legal advice. To obtain legal advice on this matter, please contact an attorney experienced in this area of law.

Lourdes Sanchez Ridge is a partner and co-Practice Group Leader of the Government Enforcement, Compliance, & White-Collar Litigation Group at Pietragallo Gordon Alfano Bosick & Raspanti LLP. She is licensed in Pennsylvania, Washington, D.C. and Florida. Tama Kudman is also a partner at Pietragallo Gordon Alfano Bosick & Raspanti LLP and a Practice Group Leader of the Florida Government Enforcement, Compliance, & White-Collar Litigation Group. She is licensed to practice law in Florida. Their bio can be found at https://www.pietragallo.com/lawyers