February 25, 2013

A Hot Year for Health Care Fraud Recoveries

By Marlene Koury

The coordinated efforts of the Departments of Justice (DOJ) and Health and Human Services (HHS) have resulted in a record breaking $4.2 billion in health care fraud recoveries in fiscal year 2012.  The agencies are required to collaborate under the Health Care Fraud and Abuse Program, which is a joint DOJ/HHS effort to coordinate federal, state and local law enforcement activities to crack down on health care fraud.  According to their recently-issued joint report, the $4.2 billion sum is the most ever recovered under the program, which since 1997 has returned $23 billion to the Medicare Trust Fund.

A large part of this cross-agency success can be attributed to the Health Care Fraud Prevention and Enforcement Action Team (HEAT).  HEAT, which is comprised of top level law enforcement agents, prosecutors, attorneys, auditors, evaluators, and other DOJ/HHS staff, was created in 2009 to increase the reach of the federal government’s health care fraud enforcement efforts.  It has done this by creating a cross-government data intelligence workgroup to share fraud trends, initiatives and ideas. 

In response to the report, Attorney General Eric Holder stressed that “[i]n the past fiscal year, our relentless pursuit of health care fraud resulted in the disruption of an array of sophisticated fraud schemes and the recovery of more taxpayer dollars than ever before.  This report demonstrates our serious commitment to prosecuting health care fraud and safeguarding our world-class health care programs from abuse.” Secretary Kathleen Sebelius echoed the sentiment by adding that “[o]ur historic effort to take on the criminals who steal from Medicare and Medicaid is paying off: We are gaining the upper hand in our fight against health care fraud….”

The report also noted the program’s success with civil health care fraud enforcement under the False Claims Act (FCA), under which $3 billion of the $4.2 billion was recovered.  The HHS allocated $8.9 million in program funds to its legal team, the Office of General Counsel (OGC), in order to support program initiatives, including by assessing qui tam actions filed under the FCA.  The OGC provided support to the DOJ by interpreting complex Medicare and Medicaid rules and policies in order to help the DOJ focus on those matters which were most likely to result in a recovery.  These matters included the hallmarks of FCA health care cases, including illegal marketing of drugs and medical devices, false billing for procedures not provided or not provided as described and violations of laws against self-referrals and kickbacks. 

The report noted that with continued support from the Obama administration, the departments expected similar success in the coming years.  With no sign of slowing down, it looks like 2013 will be another hot year for health care fraud recoveries.

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