Defense Attorneys Representing Medical Marketers Accused of Violating Federal Laws
Former DOJ-Prosecutors & Health Care Law Defense Counsel
Is it legal for medical marketers to pay beneficiaries to incentivize the patient to select a particular provider, prescription, or medical service? Does it make any difference if the patient is part of a federally funded program (Medicare, Medicaid, Tricare, DOL) or is covered by private insurance? This brief article explains that any time a medical marketer provides a payment or gift to a beneficiary, that marketer risks violating federal law.
About Oberheiden Law
The attorneys of the Oberheiden & McMurrey, LLP include former Assistant U.S. Attorneys (AUSA), former federal prosecutors, and attorneys that have substantial experience defending clients in federal investigations. We understand that nobody is perfect and our experience tells us that many people are simply unaware of what is permitted and what prohibited when it comes to the complex rules of health care and health care marketing. If you have questions about an investigation or marketing in general, you should contact one of our senior lawyers directly. We do not use junior lawyers or paralegals and all consultations will be free and confidential between you and senior counsel. Call today!
Current Marketing Fraud Investigations
The Department of Justice currently investigates medical marketers and business owners that have at some point in the last few years entered a payment arrangement with patients. Federal prosecutions have mushroomed all across the United States and many people that contact Oberheiden & McMurrey, LLP are shocked to find out that this new trend of marketing bears some compliance risks.
Traditionally, medical marketing occurred between a medical marketing business (e.g. pharmaceutical company) and a physician or institutional provider (e.g. a pharmacy). In oversimplified terms, the marketing pitch was to convince a provider to use a certain product over another product from a competitor based on better quality, better results, and better patient care.
While these marketing arrangements continue to boost the medical economy, a new medical marketing trend departs from the traditional marketer-provider structure by directly marketing those that ultimately matter in all marketing- the consumer, or here the patients.
The idea is simple. If the patient ultimately decides which pharmacy to use, which doctor to consult with, and which medical service to try, then it seems to make sense to market and advertise patients directly.
The problem with that approach is that the federal government thinks it is illegal to market patients in most cases. Prosecutions have recently emerged and medical marketers and business owners have reached out to our attorneys after they had been contacted by FBI agents and other federal law enforcement agencies. The government investigates with great intensity alleged collusions between patients and marketers, arrangements under which patients are paid regularly or just once to favor and prefer a certain provider.
Federal law has long been strict about direct marketing. Medicare rules generally prohibit most forms of marketing targeted at beneficiaries directly and so that other federally funded programs. Tricare, for example, the federal program that insures military members and their families, interdicts medical marketing of Tricare beneficiaries. Recent federal prosecutions of Tricare beneficiaries that received payments for participating in Tricare compound prescription schemes and those that paid military patients exemplify how dangerous it is to cross marketing lines when it comes to federal patients.
Unfortunately, many people believe that these rules do not apply to those patients that are not covered by a federal program but by private insurance companies. Although the federal government recognizes the limits of applying the federal Anti-Kickback statute to alleged kickbacks involving private insurance companies, federal prosecutors have chosen a different route to subject patients and marketers involved in private insurance payment schemes to federal prosecution. The next section explains how.
Criminal Prosecutions of Private Insurance Program Fraud
The attorneys of Oberheiden & McMurrey, LLP are on the forefront of defending business owners against federal prosecution for alleged patient bribery. From the many cases that our attorneys are involved in we understand how the federal government construes a federal case (despite the private insurance environment) and what to do against it.
Investigations against marketing groups and business executives allege violations of several federal statutes: health care fraud (18 U.S.C. Sect. 1347), mail fraud (18 U.S.C. Sect. 1341), wire fraud (18 U.S.C. Sect. 1343), and money laundering (18 U.S.C. Sect. 1956). A conviction for either one of these offenses can be life altering and caution is in order when being implicated in a federal fraud investigation.
Money laundering, by contrast, is any transaction that seeks to disguise, conceal, or hide proceeds of illegal activities or that is designed to evade taxes. Federal prosecutors take the position that paying a patient is similar to a delivery of cash from a drug dealer to a money launderer. Money laundering is a serious offense and one count of federal money laundering alone triggers a penalty range of up to 20 years in prison.
Mail and wire fraud prohibit a scheme to defraud that uses the mail or wire (e.g. the internet). Federal law has long established that the use of electronic means (e.g. the internet, emails, phones) qualify as wire fraud. A single count of mail or wire fraud exposes a defendant to a penalty range of up to 20 years in prison.
Health care fraud convictions assume that a defendant was engaged in a scheme to willfully and knowingly defraud any health care benefit program. Penalties for health care fraud are severe and include up to 10 years in prison for each count of health care fraud and up to a 20-year prison term for each count of health care fraud resulting in serious bodily injury to a patient.
At Oberheiden & McMurrey, LLP, our top priority is to avoid criminal charges for our clients. Depending on the stage of the case and the timing of our involvement, our attorneys have had great success providing effective criminal protection to our clients. Our team of former DOJ prosecutors and veteran health care law defense attorneys offer clients valuable insights from within government law enforcement and from being on the forefront of health care cases.
Former DOJ-Prosecutors & Defense Attorneys Can Help You
The attorneys of Oberheiden & McMurrey, LLP include former Assistant U.S. Attorneys and experienced defense attorneys that offer their experience for a free and confidential consultation, including on weekends.
- Nick Oberheiden offers proven health care fraud defense experience to physicians, pharmacies, laboratories, and health care business owners and executives against allegations of fraud, false claims, kickbacks, and prescription fraud, brought by the DOJ, OIG, CMS, IRS, FBI, DEA, DOD (Department of Defense), and other federal agencies. Dr. Oberheiden is trained in negotiations by Harvard Law School, and he received his Juris Doctor from UCLA School of Law. He also holds as a PhD in law. His practice is limited to federal law, in particular focusing on federal health care law investigations.
- Lynette S. Byrd is a former Department of Justice prosecutor with broad experience in both civil and criminal health care investigations. At the U.S. Attorney’s Office, Ms. Byrd conducted False Claims Act, Stark Law, and Anti-Kickback prosecutions. Lynette is an aggressive trial attorney and she currently represents numerous physicians and business owners in federal health care fraud investigations.
Recent Case Outcomes
The healthcare fraud defense attorneys of Oberheiden & McMurrey, LLP have successfully defended business owners, health care marketing companies, physicians, pharmacies, device companies, toxicology laboratories, service management organizations and many others in federal health care fraud investigations across the United States. Here are recent case outcomes.
- Representation of Medical Marketing Group. Our Client Received a Subpoena from the Department of Health and Human Services and Office of Inspector General. The Government Informed Our Client that the Business Is Under Health Care Fraud Investigation and Requested Large Amounts of Documents Including Emails and Corporate Documents in an Attempt to Find Evidence of Fraud. We Assisted the Client with the Document Production and Parallel to that We Began Negotiating a Resolution with the Government. We Were Able to Demonstrate that Alleged Health Care Fraud Did Not Occur and We Concluded the Matter with No Civil and No Criminal Liability for Our Client and Any of Its Principals, Directors, Employees, and Otherwise Affiliated Individuals.
- Representation of Medical Business Owner. The Federal Government Accused Our Client of Violations of the Anti-Kickback Statute and Participation in a Federal Health Care Fraud Conspiracy. Our Attorneys Immediately Reached Out to the Prosecutors and Began a Series of Negotiations to Resolve the Matter Without Criminal Charges. After Several Months, the Government Agreed that Our Client Did Not Violate Any Laws and We Were Able to Resolve this Investigation with No Civil and No Criminal Liability for Our Client and Any of Its Principals, Directors, Employees, and Otherwise Affiliated Individuals.
- Federal Health Care Fraud Investigation by the U.S. Attorney’s Office and the Federal Bureau of Investigation (FBI) Against Our Client. We Were Able to Convince the Government to End the Case Investigation After Providing Convincing Evidence that Our Client Complied With All Relevant Medicare Laws and Regulations. Our Detailed Medicare Law Understanding Allowed Us to Successfully Defend Our Client and the Case Resulted in No Civil and No Criminal Liability for Our Client and Any of Its Principals, Directors, Employees, and Otherwise Affiliated Individuals.
- Federal Health Care Fraud Investigation by Department of Health and Human Services in Connection with the Department of Justice Against Our Client. Initially, Our Client Received a Subpoena from the Department of Health and Human Services and the Office of Inspector General for Alleged Medicare Fraud. We Were Able to Stop the Investigation and We Were Able to Successfully Defend Our Client and the Case Resulted in No Civil and No Criminal Liability for Our Client and Any of Its Principals, Directors, Employees, and Otherwise Affiliated Individuals.
- Federal Health Care Fraud Investigation by Various Federal Law Enforcement Agencies Including the Headquarters of the Office of Inspector General in Washington D.C. Against Our Client. We Were Able to Convince the Government to End the Investigation After Providing Compelling Health Care Law Reasons that Our Client Did Comply with Relevant Laws and Regulations. We Were Able to Successfully Defend Our Client and the Case Resulted in No Civil and No Criminal Liability for Our Client and Any of Its Principals, Directors, Employees, and Otherwise Affiliated Individuals.
If you have reason to believe you are under investigation, you should contact Oberheiden & McMurrey, LLP today for a free and confidential consultation. Our attorneys are standing by seven days a week – including weekends – to answer your questions or discuss how we may be able to help you in our case.
Compliance – Litigation – Defense