DOJ announces new removal of COVID-19 fraud – but will it extend enforcement to more complex schemes? | Morgan Lewis – Health Law Scan
DOJ announces new removal of COVID-19 fraud – but will it extend enforcement to more complex schemes?  |  Morgan Lewis – Health Law Scan

DOJ announces new removal of COVID-19 fraud – but will it extend enforcement to more complex schemes? | Morgan Lewis – Health Law Scan

Fraud stemming from the COVID-19 pandemic remains a criminal enforcement priority for the U.S. Department of Justice (DOJ). On April 20, the DOJ announced a new round of criminal charges against 21 defendants, stemming from over $ 149 million in allegedly fraudulent billing for federal health and pandemic assistance programs. The new cases raise the DOJ’s total COVID-19-related enforcement statistics to 35 defendants and over $ 290 million in fraudulent billing across 16 federal districts.

The allegations described in the DOJ’s latest press release involve schemes related to COVID-19 testing, telecommunications health and misappropriation of Provider Relief Fund (PRF) payments. These schemes are almost identical to the DOJ’s first COVID-19 enforcement action announced in May last year. Not surprisingly, the DOJ’s criminal enforcement activities have focused on individuals who benefit from the rapidly building infrastructure around the country’s response to the pandemic. Although it is an important enforcement priority, the behavior involved has been relatively unsophisticated. In a case involving a manufacturer of counterfeit COVID-19 vaccination cards, the defendant even told an undercover federal agent, “until I get caught and go to jail … I take the money, ha! I do not care.”

The real story, however, may be in what lies ahead. The DOJ’s latest announcement shows that it continues to pursue schemes designed to be quick and easy to profit. However, given the massive size of federal programs designed to combat COVID-19 (PRF is $ 178 billion, of which nearly $ 120 billion has been distributed to health care providers), the DOJ’s focus may ultimately turn to more complex and sophisticated schemes. . Many of these may be the result of qui tam complaints or based on investigations and audits conducted by the Office of the Inspector General of the U.S. Department of Health and Human Services.

Stakeholders in the health and life sciences industry should try to get ahead of this expected wave of enforcement and audit activity. This includes carefully evaluating your organization’s involvement in COVID-19 related programs (did your organization receive PRF or Paycheck Protection Program funds, for example?), As well as complying with the myriad terms and conditions for each of these programs. Especially for business organizations that may have received PRF funds across multiple providers, evaluation and documentation of the use of these funds remains an important risk mitigation activity.

In particular, reflecting the rapid development of these programs, the federal government continues to update its policies on PRF reporting and other COVID-19 programs. For example, the Health Resources & Services Administration recently announced that providers experiencing mitigating circumstances may submit PRF reports late. As has happened in other major emergencies, it can be particularly challenging for providers to identify changes made by government entities to legal requirements and obligations that can lead to significant risk exposure after the dust has settled.

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