DOJ Demonstrates Commitment to COVID-19-Related Healthcare Enforcement With New Criminal Charges
On April 20, 2022, the US Department of Justice (DOJ) announced a nationwide coordinated law enforcement action focused on COVID-19-related healthcare fraud. In total, DOJ brought criminal charges against 21 individuals, including physicians and healthcare executives, in connection with alleged fraud schemes resulting in almost $150 million in improper government claims. These new criminal charges, as well as recent civil and administrative actions, come on the heels of DOJ statements reaffirming its commitment to aggressively pursuing COVID-19-related healthcare frauds, and provide further evidence that DOJ’s enforcement efforts in this area are likely to continue for the foreseeable future.
The specific charges brought during the April 2022 enforcement action are consistent with DOJ’s longstanding COVID-19-related healthcare fraud priorities and are similar to charges pursued during a May 2021 COVID-19 healthcare fraud enforcement action. These new charges focus on the following COVID-19-related enforcement priorities:
Telehealth. In recent years, DOJ and the US Department of Health and Human Services Office of Inspector General (HHS-OIG) have consistently prioritized prosecuting fraudulent telehealth schemes. The April 2022 enforcement action follow this trend. For example, at least one medical professional was charged in connection with his role in a kickback scheme that involved billing for sham telemedicine encounters and agreeing to order unnecessary genetic testing in exchange for access to telehealth patients.
Provider Relief Fund. The April 2022 enforcement action also reflects DOJ’s continued focus on fraud in connection with the Provider Relief Fund (PRF), which was created as part of the Coronavirus Aid, Relief and Economic Security Act to provide direct payments to “eligible health care providers for health care-related expenses [and] lost revenues that are attributable to coronavirus.” Two defendants were charged with misappropriating PRF monies. Although the PRF cases to date all focus on blatant instances of fraud and abuse in connection with the PRF, more complex PRF cases are expected to follow, both in the criminal and civil space.
Improper Billing Schemes. DOJ and HHS-OIG continue to target improper billing schemes that involve COVID-19 services. Several cases in the April 2022 enforcement action involve defendants who allegedly offered COVID-19 testing, then used beneficiary information to submit false and fraudulent claims for other services that were either medically unnecessary or never provided.
In announcing these new charges, DOJ Criminal Division Assistant Attorney General Kenneth A. Polite, Jr., emphasized DOJ’s “commitment to using all available tools to hold accountable medical professionals, corporate executives, and others who have placed greed above care during an unprecedented public health emergency.” HHS Inspector General Christi A. Grimm also highlighted HHS-OIG’s commitment to pursuing COVID-19-related fraud, stating that the “attempt to profit from the COVID-19 pandemic by targeting beneficiaries and stealing from federal health programs is unconscionable.”
DOJ and HHS-OIG’s civil and administrative enforcement activity also appears to be picking up steam. For example, in early April 2022, DOJ settled a False Claims Act and Financial Institutions Reform, Recovery and Enforcement Act case involving a COVID-19-related improper billing scheme for almost $25 million. Among other things, DOJ alleged that a Florida healthcare provider attempted to compensate for lower revenues during the pandemic by requiring physicians to schedule unnecessary evaluation and management appointments and ordering medically unnecessary testing services. The provider also falsely claimed that it was not engaged in illegal activity when it applied for and obtained a $5.9 million Paycheck Protection Program loan.
In connection with the April 2022 enforcement action, the Centers for Medicare & Medicaid Services Center for Program Integrity announced that it had taken administrative actions against 28 providers for their alleged involvement in fraud, waste and abuse schemes related to the delivery of care for COVID-19, as well as other schemes that capitalized upon the public health emergency.
Although the United States appears to be finally emerging from the pandemic, the federal government’s COVID-19-related healthcare enforcement activity shows no signs of slowing down. DOJ, HHS-OIG, and other federal and state agencies continue to aggressively pursue pandemic-related criminal, civil and administrative healthcare enforcement actions. Healthcare companies, hospital systems and providers should prepare for this increased scrutiny by taking proactive steps to minimize their enforcement risk.