Federal Medicare and Medicaid Fraud Defense Attorney

Facing a federal investigation or formal indictment for healthcare fraud can endanger your medical license, personal assets, and freedom. The federal government aggressively investigates and prosecutes healthcare providers, facilities, and individuals accused of exploiting government healthcare programs.

At Hedding Law Firm, our federal criminal defense attorneys provide aggressive, strategic representation to counter federal task forces, dismantle the prosecution's evidence, and protect your livelihood.

What is Federal Medicare and Medicaid Fraud?

While related, Medicare and Medicaid are distinct federal programs, and fraud allegations involving either carry severe legal repercussions under federal statutory authority.

Medicaid fraud occurs when healthcare providers, individuals, or facilities knowingly make false statements or representations of material facts to obtain unauthorized payments or benefits from the state and federally funded Medicaid program.

Medicare fraud occurs when individuals or organizations knowingly execute, or attempt to execute, a scheme to defraud the Medicare program or obtain money or property owned by, or under the custody of, Medicare through false pretenses, representations, or promises.

Statutory Authority and Related Federal Laws

Federal prosecutors rely on several core statutes to charge healthcare entities and individuals:

The False Claims Act (31 U.S.C. § 3729): Imposes civil liability on individuals and companies who knowingly submit, or cause others to submit, false or fraudulent claims to the federal government.
The False Statements Act (18 U.S.C. § 1001): Makes it a federal crime to knowingly and willfully make materially false, fictitious, or fraudulent statements or representations in any matter within the jurisdiction of the executive branch.
Health Care Fraud (18 U.S.C. § 1347): Criminalizes knowingly executing a scheme to defraud any healthcare benefit program, carrying up to 10 years in prison per count (or life if the violation results in death).
Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)): Prohibits paying, soliciting, or receiving remuneration to induce or reward referrals for items or services payable by federal healthcare programs.
Stark Law (42 U.S.C. § 1395nn): A civil statute prohibiting physician referrals for designated health services to entities with which the physician has a financial relationship, unless a specific exception applies.

Summary of Federal Penalties

Convictions for Medicare or Medicaid fraud carry cascading criminal, civil, and administrative consequences:

Penalty Category	Maximum Statutory / Administrative Consequence
Criminal Imprisonment	Up to 5 years per count under 18 U.S.C. § 1001; up to 10 years under 18 U.S.C. § 1347
Criminal Fines	Up to $250,000 for individuals; up to $500,000 for organizations per felony count
Civil Monetary Penalties	Up to $2,000 to $11,000+ per individual false claim submitted, plus treble (3x) damages
Mandatory Restitution	Full court-ordered repayment of all payments received through alleged fraud
Administrative Exclusion	Exclusion from participating in Medicare, Medicaid, and all federal healthcare programs
Professional Licensure	Suspension or permanent revocation of state medical, dental, or nursing licenses

Common Healthcare Fraud Schemes

Federal task forces commonly target healthcare providers for specific operational practices:

Phantom Billing: Submitting claims for services, equipment, or face-to-face visits that were never performed or supplied.
Upcoding: Billing for a higher, more expensive level of service than what was actually provided or medically necessary.
Unbundling: Separating procedures that should be billed under a single, comprehensive CPT code into multiple codes to increase total reimbursement.
Kickbacks and Illegal Referrals: Accepting financial incentives, gifts, or compensation in exchange for patient referrals or prescribing specific equipment and drugs.
Identity Misuse: Using legitimate patient or physician credentials to process unauthorized claims without their knowledge.

Hypothetical Case Examples

Unintentional Billing Error vs. Intentional Upcoding: A busy medical clinic utilizes outdated billing software, automatically assigning higher-tier evaluation CPT codes. Federal investigators allege systemic upcoding. Defense strategy focus: Lack of fraudulent intent and administrative oversight.
Phantom Service Allegation: A home healthcare agency is accused of billing Medicaid for visits while a patient was hospitalized. Defense strategy focus: Demonstrating third-party timesheet errors rather than deliberate intent to deceive.
Identity Theft Scheme: An independent medical supplier obtains stolen Medicare numbers to submit unauthorized claims for durable medical equipment (DME). Defense strategy focus: Establishing that the target was an uninvolved third party or lacked knowledge of the illicit origin.

Defense Strategies in Federal Fraud Investigations

The cornerstone of a successful federal healthcare fraud defense is attacking the element of intent. To secure a criminal conviction, the government must prove beyond a reasonable doubt that you acted knowingly and willfully with the intent to defraud.

1. Absence of Intent and Good-Faith Errors

Complex billing codes, changing CMS guidelines, and administrative oversights frequently lead to unintentional mistakes. Mistakes, poor recordkeeping, or reliance on certified billing specialists do not constitute criminal fraud.

2. Challenging the Investigation Tactics

Federal investigators often attempt informal interviews to obtain self-incriminating statements before formal charges are filed. Having an attorney step in early stops direct agency contact, preserves your rights, and prevents unintentional self-incrimination.

3. Evaluating Jury Instructions and Evidentiary Burdens

We analyze jury instructions and federal evidentiary rules to force the prosecution to prove every material element of the charge. When the government's evidence relies on assumptions or complex bureaucratic record-keeping, we present counter-evidence to highlight reasonable doubt.

Frequently Asked Questions

What is the primary difference between Medicare and Medicaid fraud?

Medicare is a federal insurance program primarily serving individuals aged 65 and older or those with specific disabilities, while Medicaid is a joint federal and state program serving low-income individuals. Fraud in either program involves deceiving the government for unauthorized financial gain, but Medicaid investigations often involve both state Medicaid Fraud Control Units (MFCUs) and federal agencies.

Can I be charged with federal fraud if the billing error was made by my staff or billing agency?

Yes, federal agencies can hold practice owners and physicians responsible for claims submitted under their National Provider Identifier (NPI). However, criminal charges require proof of intent or deliberate ignorance. Demonstrating that the error was caused by a third-party billing agency or staff mistake without your knowledge is a primary defense against criminal prosecution.

What should I do if federal agents arrive at my practice with a search warrant or subpoena?

Do not obstruct the agents, but do not consent to interviews or answer questions without your attorney present. Request a copy of the search warrant, inspect the scope of the warrant, take careful notes, and contact a federal criminal defense attorney immediately.

What is a Civil Investigative Demand (CID)?

A CID is a legal discovery tool used by federal prosecutors under the False Claims Act to obtain documents, written answers, or oral testimony before filing a lawsuit. Receiving a CID indicates you or your business are under federal investigation, making immediate legal representation essential.

Can a civil Medicare fraud investigation turn into a criminal prosecution?

Yes. Federal healthcare investigations frequently start in civil divisions or administrative bodies. If investigators uncover evidence suggesting willful deception or intentional schemes, the case is referred to a criminal task force or the U.S. Attorney's Office for indictment.

Will I lose my medical license if I am investigated for healthcare fraud?

An investigation alone does not cause license loss, but a criminal conviction or administrative exclusion from federal healthcare programs almost always triggers disciplinary proceedings by state licensing boards. Securing an early defense helps protect both your liberty and your professional credentials.

What is the federal exclusion list (LEIE)?

The List of Excluded Individuals/Entities (LEIE), maintained by the HHS Office of Inspector General (OIG), prohibits excluded individuals from receiving payment from any federal healthcare program for items or services provided. An exclusion can effectively end a healthcare professional's career.

Is lack of intent a valid defense against False Claims Act charges?

Yes. While the civil False Claims Act includes "reckless disregard" or "deliberate ignorance" alongside actual knowledge, demonstrating that you acted in good faith, followed medical advice, or made an honest administrative mistake directly undermines the government's claim.

Take Control of Your Federal Defense

If you are facing a federal healthcare fraud inquiry, audit, or formal indictment in Los Angeles or nationwide, immediate legal intervention is critical. Contact Hedding Law Firm today for a confidential consultation to review your options and mount a rigorous defense.

Medicaid Fraud