Health Care Fraud Investigations: Anatomy of an OIG Investigation

The Department of Health and Human Services’ Office of the Inspector General (HHS-OIG, or OIG) is continuing pace for rigorous investigation of waste, fraud, and abuse committed against federal health care programs. According to the OIG’s recently published semi-annual report to Congress, the OIG reported its investigations in federal health care fraud in the 2018 Fiscal Year yielded nearly:

• $3 billion in recoveries;
• More Than 760 criminal actions;
• Over 2,700 exclusions of providers / suppliers, and
• 800+ civil actions.

Much of that came by way of the OIG’s nationwide health fraud takedown, and through collaboration with state and federal law enforcement partners; and if it sounds like a lot, it’s because it is. The OIG is an extremely aggressive investigatory branch of the HHS, and its main objective is to oust fraud and abuse through various enforcement tactics and meticulous investigations. These health care fraud investigations are multi-faceted and very high stakes proceedings, and they subject providers and suppliers to tremendous penalties.

At Hendershot Cowart P.C., our health and medical law attorneys have seen the evolution of OIG investigations, the increasing support they receive from Texas-based enforcement and regulatory officials, and the increasingly high stakes they create for all types of providers and suppliers who find themselves under the microscope. In addition to helping clients across Texas in proactive planning and counsel to prevent fraud investigations, we’re also immediately available to provide the responsive representation and health care fraud defense clients need when it matters most.

Facing an OIG health care fraud investigation in Texas? Call (713) 909-7323 to speak with an attorney.

What Is the OIG?

The HHS-OIG is the “premier” law enforcement agency for investigating health care fraud. Its primary mission is to protect beneficiaries and federal health programs, including Medicare and Medicaid, TRICARE, and the VA. To accomplish this, the OIG works closely with various law enforcement agencies at both the state and federal level (including the FBI, DOJ, U.S. Attorneys, and Texas OIG), and wields a variety of enforcement tools during investigations – from interviews, on-site visits, and subpoenas to surveillance and undercover operations when things take a criminal turn.

Our goals concerning any health care fraud investigation, and especially those in which the OIG is involved or could potentially become involved, revolve around a few basic objectives:

• Keep investigations civil, meaning no criminal investigations or charges;
• Maintain confidentiality and protect clients from reputational harm;
• Engage in early intervention strategies, good faith efforts, and other channels of communication to secure resolutions as early as possible; and
• Negotiate the most favorable outcome possible.

Meeting these objectives requires profound experience and knowledge of health care laws, and insight and familiarity with how health care fraud investigations work. Below, we break down the anatomy of an OIG investigation.

1. How OIG Investigations Begin

OIG Investigations can begin to take form following a number of “red flags” and enforcement efforts involving various agencies. The most common ways they begin include:

• Audits in which analysts identify unusual patterns or billing practices (i.e. double billing, up-coding, unbundling, billing for services not rendered, etc.);
• Qui-tam lawsuits initiated by whistleblowers with inside information about your business;
• Patient complaints regarding providers.

The OIG may also work with other agencies, such as the DOJ, U.S. Attorneys or Assistant U.S. Attorneys, and the FBI, that initiate Civil Investigative Demands (CIDs) or other investigatory tools in connection to fraudulent claims, kickbacks, bribes, and rebates which violate the False Claims Act or laws such as the Anti-Kickback Statute and Stark Law. As federal health care fraud laws with provisions for both civil and criminal prosecution, taking immediate action upon any notice of an investigation is vital to implementing strategies to keep these matters within the civil realm, and resolved before they escalate.

2. OIG Requests for Information

The more formal aspects of OIG investigations are those in which the OIG takes steps to request more information. These fact-finding missions are conducted with a great deal of precision and a tremendous amount of foresight – OIG agents know what they’re looking for, and they know how to get it. Without an experienced health care fraud attorney by your side, even if you believe you’re absolutely “innocent” and free to talk, you risk providing the OIG with information and evidence that can be used against you.

Requests for information may involve “formal” and less-formal approaches that, although presented as informal, genial, or due diligence endeavors, still pose risks and concerns for providers. These may include:

• OIG subpoenas
• Requests for interviews or “chats”
• Unannounced visits

What our clients experience most often is an OIG officer asking them or their employees to “come in for a chat.”

“Don't worry, you're not the target. We'd just like to talk with you.”

The investigator wants you to come in for a chat under the pretense that you're not the target. Don't be fooled by this approach.

On one end of the extreme, the OIG or AG show up, flash a badge, and close you down by loading up their vans with your files and computers and driving off with them.

Granted, this is an extreme scenario, and it doesn't happen very often, but it does happen. If this happens, make sure you have copies of everything.

3. Responding to an OIG Investigation: Strategies

It is an unfortunate fact that providers and suppliers who go without legal representation often end up ensnared in criminal cases involving health care fraud allegations. One of the most important things you can do upon any notification that you’re under investigation, or might be, is to speak immediately with an attorney knowledgeable in health care laws and fraud defense. The importance of early intervention and strategic response strategies cannot be understated.

Though we carefully tailor response plans to the unique circumstances of our clients, there are some general areas of focus. These include:

• Determining if Cases are Civil or Criminal – Most providers don’t know whether their OIG investigation is civil or criminal in nature. That’s because early contact from the OIG, whether through a subpoena or less-formal means of information gathering, does not necessarily indicate whether a health care fraud case will be civil or criminal. While the underlying facts do play a role in that, so do the steps you take when making a response plan. With few clear signs to operate on, and great risks of civil investigations turning criminal, your future depends on your ability to gauge whether an investigation has a criminal element or the potential for turning into a criminal case, and what steps you can take accordingly.
• Opening Lines of Communication – Opening lines of communication with the OIG and any other agency involved in an investigation is crucially important for a number of reasons. First, it can provide clients (and attorneys who know what to look for) with insight regarding the tone and trajectory of investigations to aid them in formulating an appropriate strategy. Additionally, it shows good faith and willingness to compromise, and can improve the availability of more favorable resolution options, whether that be investigation dismissals, cases being kept within the civil realm, or quick resolutions with as limited an adverse impact on providers as possible.
• Easing Burdens, Limiting Requests – The work health care fraud attorneys engage in can have both practical and “bigger picture” implications. By communicating with investigators and assessing the nature of the case, attorneys can work toward easing the immediate burdens clients may face, particularly when it comes to production of documents and evidence. Limiting the scope of requests can not only help in the immediacy of a pending case, but also in terms of its larger focus; that is, reducing the information made available to investigators, and reducing their ability to find or create red flags that may be used as a starting point for criminal charges.
• Protecting Rights, Avoiding Mistakes – Providers are not without their rights during health care fraud investigations, nor are they immune from making grave mistakes. As attorneys who are highly familiar with OIG investigations and other health care fraud enforcement actions, we know the rules and procedures by which investigators are bound, what lines they can and cannot cross, and what rights and options clients have, as well as what options are most appropriate for them to take. In the same vein, we know what types of mistakes (from the obvious incriminating statement to the seemingly minor furnishing of internal e-mails) unrepresented providers, and to some degree inexperienced attorneys, can make during investigations, and how to avoid them.

4. The Outcome of an OIG Investigation

Though overly simplified, the outcome of an OIG investigation can generally be good (meaning you’ll still have a future in health care) or very bad (meaning criminal convictions). From full case dismissals to prison sentences, the resolution of any health care fraud investigation will always depend on the underlying issues and allegations, and the steps you take in response. Though there are varying types of outcomes imposed by the OIG and other federal agencies, the most general include:

• Dismissals / no criminal or civil liability;
• No criminal liability, but civil settlements over civil monetary penalties and recoupment;
• Administrative penalties, including Medicare exclusions, billing privilege revocations, license suspensions or revocations, etc.
• Criminal charges and potential penalties that may include anywhere from 0 to 10 years of incarceration in federal prison for each count of health care fraud.

Under Investigation for Health Care Fraud in Houston or Texas? Call (713) 909-7323

If you are the target of a health care fraud investigation, are facing enforcement actions that could result in further investigatory inquiries, or want to safeguard your medical contracts, billing practices, and compliance policies to reduce risks that you might one day be under investigation, Hendershot Cowart P.C. can help. Call (713) 909-7323 or contact us online to request a confidential consultation with an attorney.