Sunday, August 10, 2008

Medicare Fraud Cases May Have Future Business Implications

A Press Release of the U.S. Attorney's Office for the Central District of California states that "the owner of a Los Angeles-area hospital and a man who acted as a recruiter – were arrested this morning on federal charges of defrauding Medicare and Medi-Cal by providing unnecessary health services to homeless people who were recruited from 'Skid Row' with promises of payments."Solomon Moore in a NYTimes article titled, Alleged Scheme Involved Homeless, provides a description of this recent investigation and indictment in California. 

There are only allegations to date, and the prosecution will bear the burden to prove the elements of the crime charged beyond a reasonable doubt.  And if they fail, the accused individuals will not suffer convictions. But cases of this nature place the accused persons in a different position than those charged with street crimes.  If convicted, the accused individuals can be subject not only to criminal penalties of possible prison time, but they may also face civil consequences such as being precluded from receiving medical benefits from the government. Individuals in the medical area who are faced with both the criminal punishment and civil collateral consequences sometimes have to evaluate their case differently in deciding how to proceed.  A minor conviction and punishment can be the  basis to shut down a businesses if their total revenue is dependent upon payments from the government.

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