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What Are the Penalties for Healthcare Fraud (18 USC § 1347)

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Healthcare fraud is a prevalent issue in the United States. According to U.S. government estimates, Medicare, for example, pays out over $25 billion a year to fraudulent claims. For that reason, healthcare fraud is taken extremely seriously and is punished quite severely. Healthcare providers facing allegations or investigations about possible healthcare fraud must act swiftly and thoroughly to root out any possible misconduct and protect themselves and their practice from criminal (not to mention civil) liability. Continue reading to learn about healthcare fraud and the potential criminal penalties a healthcare fraud conviction may entail, and call a zealous California healthcare fraud and abuse defense attorney for help responding to an investigation or defending against fraud charges.

Defining Healthcare Fraud

18 USC § 1347 criminalizes the act of healthcare fraud. According to the statute, it is a crime for anyone to “knowingly and willfully” do or attempt to do either of the following:

  • Defraud any healthcare benefit program; or
  • Use means of fraud, false representations, false promises, or false pretenses to obtain money or property from any healthcare benefit program

The law explicitly states that knowledge of the law is not a prerequisite for the commission of the crime of health care fraud. Regardless of whether the defendant knows that their conduct is criminal, if they know that they are using fraudulent means to obtain money from a healthcare benefit program, they are guilty of healthcare fraud. Additionally, the law makes clear that an attempt to defraud a healthcare benefit program is punishable as a primary offense.

Healthcare benefit program is defined elsewhere in the law. According to 18 USC § 24(b), a “healthcare benefit program” is “any public or private plan or contract, affecting commerce, under which any medical benefit, item, or service is provided to any individual, and includes any individual or entity who is providing a medical benefit, item, or service for which payment may be made under the plan or contract.” That means that healthcare providers can be prosecuted for defrauding or attempting to defraud entities including:

  • Medicare
  • Medicaid
  • The Department of Veterans Affairs (VA)
  • Private health insurance plans
  • Other public benefits programs

Punishment for Commission of Healthcare Fraud

Healthcare fraud is a very serious crime, and conviction under section 1347 carries stiff penalties. Convicted defendants can face up to $250,000 in fines and up 10 years in prison, or both. That applies just to the baseline offense. The level of the monetary penalty can significantly exceed $250,000 depending upon the level of pecuniary gain the defendant enjoyed as a result of the fraud as well as the amount of loss suffered by parties other than the defendant.

Moreover, if the commission of the crime involved serious bodily harm to a person, the defendant can face up to 20 years in prison. If someone died as a result of the fraud, a convicted defendant could face a life sentence.

Seasoned Advice and Dedicated Representation for Your California Medical Practice

For help responding to healthcare fraud allegations or for assistance with healthcare regulatory compliance, auditing, employment disputes, mergers and acquisitions, business disputes, licensing, or any other California healthcare law matter, contact the Law Offices of Art Kalantar in Los Angeles or California statewide at 310-773-0001.

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