On March 16th, Attorney General William Barr issued a memorandum to all United States Attorneys directing each U.S. Attorney’s Office (USAO) to “prioritize the detection, investigation, and prosecution of all criminal conduct related to the current pandemic,” noting that “the pandemic is dangerous enough without wrongdoers seeking to profit from public panic.” It appears that USAOs have wasted no time in prioritizing such cases, as the owner of a Georgia-based marketing company that generated leads for medical-testing companies was arrested earlier this week and charged with conspiracy to commit health care fraud and conspiracy to violate the Anti-Kickback Statute.
The defendant is accused of participating in a scheme to receive kickbacks in return for referring patients for certain kinds of laboratory testing. Originally, this scheme was alleged to have involved genetic cancer screening tests (which has also been a focus of recent DOJ enforcement efforts). As the coronavirus began to spread across the country, the defendant allegedly re-focused the scheme on testing for COVID-19, where testing for COVID-19 was bundled with a more expensive respiratory pathogen panel test (which does not identify or treat COVID-19). In sum, the scheme involved Medicare claims worth over $1.1 million.
In a press release, the USAO in New Jersey not surprisingly took particular issue with the defendant’s “preying on people’s fear” in the time of a crisis and viewing the pandemic as a money-making opportunity, noting several statements made by the defendant:
While this prosecution is an early indicator that we can expect an ongoing prioritization by USAOs across the country of investigating and prosecuting coronavirus-related fraud, the government’s particular focus on language and efforts related to making money in the time of crisis also serve as a helpful (if not obvious) reminder that health care companies and providers should continue enforce their compliance policies, practices, and trainings, as best they are able. We expect that the government’s enforcement focus in this particular area will not necessarily lessen whenever the acuity of this crisis starts to ease, so health care companies and providers would be well-served to ensure that good compliance practices do not change even as the health care climate does so.