On March 24, the U.S. Court of Appeals for the Fifth Circuit affirmed the criminal healthcare fraud convictions of two individuals who ran a network of home health and hospice centers in Texas. According to the Fifth Circuit, the defendants operated a “reimburse-first-verify-later system” for nearly ten years, under which an estimated 70 to 85 percent of patients were ineligible for the care they received. The Fifth Circuit provided colorful examples to show that “many certifications were not borderline cases”:

One hospice patient had a regular job at [a retail store], even though having employment disqualifies patients from hospice. Another, who supposedly had terminal-level dementia, recounted to his nurse a days-old memory of twisting his knee while dancing the Macarena at a family celebration. And one home health patient was actually a boxing instructor at a local gym; he was spotted drinking a beer while driving when he was supposed to be stuck at home with a disability.

But these examples were not meant to make light of the defendants’ conduct. The defendants enforced their scheme by giving staff raises and bonuses to participate in the fraud, and threatening, yelling at, and even firing employees who did not go along.

Citing False Claims Act cases that have held that a physician’s certification of eligibility cannot be found “objectively false” based on after-the-fact testimony from the government’s medical expert, see, e.g., United States v. Aseracare, Inc., 938 F.3d 1278 (11th Cir. 2019) (which we have covered in previous posts), the defendants argued that their convictions should be overturned. But the Fifth Circuit was not convinced. “Health care providers cannot immunize themselves from prosecution by cloaking fraud with a doctor’s note,” the Fifth Circuit reasoned.

Ultimately, the Fifth Circuit found an “abundance” of evidence supported the convictions, including “a doctor’s testimony that he lied when certifying a patient.” The Fifth Circuit held that this evidence was categorically different from the difference of clinical opinion addressed in Aseracare.

A copy of the Fifth Circuit’s decision is linked here.