Oklahoma Healthcare Fraud: Medicaid & Medicare Fraud and Pill Mills

Bob Wyatt has had the privilege to make “new law” in two landmark decisions in healthcare—one in 2018 and one in 1994 (see Noteworthy cases below).  However, the Wyatt Law Office routinely represents healthcare providers in criminal and administrative investigations and in licensing matters with the Medical Licensure Board, the Board of Osteopathic Examiners, the Department of Health, the Department of Mental Health, and other administrative and investigative agencies.

Many cases alleging Oklahoma healthcare fraud involve either Medicare or Medicaid, but other criminal investigations also involve private insurance companies, research grants, and illegal drug distribution. Medicare Fraud and Medicaid Fraud investigations may result in charges filed in the federal courts (for healthcare fraud, mail fraud, wire fraud, money laundering and drug distribution). Some Medicaid fraud investigations are processed through the Oklahoma Attorney General’s Office, the Office of the District Attorney for a particular county or the Oklahoma Healthcare Authority. When federal investigations occur, they are generally handled by the DEA, FBI, or the Office of Inspector General for one of the affected federal agencies. Other agencies such as the FDA or some branches of the military investigative services may also be involved.

Many Kinds Of Offenses

Some indictments may include conspiracy charges and substantive offenses such as:

  • Medicare Fraud and Abuse
  • Medicaid Fraud and Abuse
  • Billing for services not rendered
  • Upcoding — billing for a higher reimbursable service
  • Performing unnecessary services
  • Kickbacks
  • Unbundling of tests and services to generate higher fees
  • Durable medical equipment fraud
  • Pharmaceutical drug diversion or distribution
  • Outpatient surgery fraud
  • Internet pharmacy sales
  • Drug distribution by issuing illegal prescriptions (primarily for opiates)

The Oklahoma Attorney General and the U.S. Attorney’s Offices are both currently investigating many allegations of Medicaid and Medicare fraud. These allegations generally involve kickback schemes, claims that the services were not performed at all, that the services were unnecessary or that the services were provided but by someone not legally authorized to perform the service. There is currently an emphasis on two types of fraudulent Medicaid services: (1) pain management, particularly prescriptions for opiates (Oxycontin, Lortab, Hydrocodone, etc); and (2) counseling services primarily home-based.  The U.S. Attorneys are focused on pain management and the opioid crisis as well as overdose deaths from pill mill-type allegations.

The “opioid epidemic” or the “Oklahoma opioid crisis” has raised red flags for Medicaid investigators looking at doctors issuing a substantial amount of opiate prescriptions or renewing opioid prescriptions. The investigators are watching the PMP (prescription monitoring program) to determine which physicians are filling quantities of opioids and watching to see how many refills are being issued to each patient. If a physician is not conducting an actual physical and history or not doing blood work on a routine basis when prescribing opiates, a criminal investigation is very possible.

The Oklahoma Attorney General Medicaid Fraud Unit is also conducting investigations into Medicaid billing fraud related to psychologists and counselors (LPC’s, LMFT’s, Behavioral Specialists, and Rehabilitative Specialists). Many of these investigations focus on home-based services where it is alleged the counseling professional either is not providing the services at all or alternatively is “up-coding” or “up-charging” for the actual service provided. Another focus for the Medicaid agents is to look for fraudulent billing practices because of violations of the Medicaid billing rules and regulations (such as billing for travel, billing on the wrong day instead of the date of services, etc).

Healthcare fraud schemes may be charged as wire or mail frauds in general and are usually combined with conspiracy charges, criminal tax charges and/or money laundering. Others are charged with Medicaid Fraud, violation of the Oklahoma Computer Crimes Act and grand larceny. The punishment range for mail and wire fraud is generally up to 20 years. For other crimes, the range of punishment varies. However all healthcare fraud allegations are serious felony matters if charged.

There are many defenses to allegations of healthcare fraud. Many times, there is a medical reason for the procedures that is in dispute. The treating physician has a better understanding of what is required for treatment for a particular patient — not some investigator or insurance company. Other times, the healthcare regulations are ambiguous. In other cases, the procedures were in fact performed as claimed. Once we review the facts, we will find a defense.

Experienced Health Care Fraud Lawyers

Call the Wyatt Law Office at 405.234.5500 for your Oklahoma Healthcare Fraud Lawyers and Attorneys.  Your future is our business.

Noteworthy Cases

Recent cases and one historical landmark decision are listed below.  Many other healthcare providers have avoided prosecution or obtained diversions or other resolutions not involving a conviction.  Because those cases were not “published” or were not publicized in the mainstream media, we only list the following cases.

Minimal Punishment.  Dr. Jeremy Thomas was charged in five separate indictments with criminal drug distribution and conspiracy in the Tulsa federal court.  The government charged him with more than 25 counts of drug distribution, each with a range of punishment up to 20 years.  Dr. Thomas confessed during the investigation before hiring counsel. The government sought a sentence of 57-71 months, but the Wyatt Law Office convinced the court to limit the sentence to only 5 months along with 8 months of home confinement.

Healthcare Fraud Conviction Reversed – case dismissed. In 2018, Bob Wyatt represented Dr. Steven DeLia in his appeal of a healthcare fraud conviction.  This case was the first known case to challenge whether the Wartime Suspension of Limitations Act (“WSLA”) applies to criminal healthcare fraud offenses under 18 U.S.C. § 1347. The court’s opinion has garnered national attention among lawyers representing healthcare providers.  Dr. DeLia was accused and convicted in the Muskogee federal court of illegally writing prescriptions for Schedule II opiates by use of pre-signed prescriptions while he was serving his country in Afghanistan as a medical officer in the Army.  The U.S. Court of Appeals for the Tenth Circuit in Denver reversed the conviction when the court held that the WSLA does not operate to toll the statute of limitations for healthcare fraud prosecuted under 18 U.S.C. § 1347.  See United States v. DeLia, 906 F.3d 1212 (10th Cir. 2018).

Medicaid Fraud – case dismissed.  Provider charged with Medicaid fraud involving home-health services.  Wyatt convinced the Attorney General to dismiss the charge after the defense investigation was completed.

Medicaid Fraud case – minimal punishment.  Counselor charged with Medicaid fraud received a deferred sentence (probation but not a conviction) in a case involving fraudulent billing and up-coding.

Drug Tampering – diversion.  Nurse accused of tampering with drug containers and diverting the drugs received a pre-trial diversion in federal court after intervention by Wyatt Law Office.

Fraudulent Billing – declined prosecution.  Chiropractor accused of fraudulent billing.  Wyatt Law Office convinced prosecutors that no crime was committed.

Fraudulent Billing – avoided charges.  Counselor accused of conspiracy to engage in fraudulent billing.  After intervention by counsel and invocation of the Fifth Amendment and refusing to cooperate in the investigation, the prosecution could not make its case for conviction against the healthcare provider.  As the U.S. Supreme Court has held that “one of the basic functions of the [Fifth Amendment] privilege is to protect innocent men” from over-zealous law enforcement and prosecutors.  See Grunewald v. United States.

Healthcare FraudConviction Reversed casedismissed. In the early 1990s, Bob Wyatt was co-counsel to two obstetric physicians and surgeons charged with multiple counts of “healthcare fraud” for alleged violation of CHAMPUS regulations as it related to over 100 patients of the surgery center. This four-year federal investigation in parallel civil and criminal proceedings concluded in a guilty verdict on all but one charge; however, Wyatt convinced the federal appeals court to reverse the convictions with orders to dismiss the charges for lack of merit. This was a case of first impression and is cited in the DOJ’s U.S. Attorney’s Manual: Criminal Resource at ‘ 912.  Bob Wyatt briefed and argued the appeal to the U.S. Court of Appeals for the Tenth Circuit. United States v. Migliaccio and Avery, 34 F.3d 1517 (10th Cir. 1994).

 Healthcare FraudConviction Reversed casedismissed.  Again in 2018, Bob Wyatt was counsel to Dr. Steven DeLia, who was charged with healthcare fraud alleging pre-signed prescriptions issued while Dr. DeLia was serving his country as a Major in the U.S. Army assigned to Afghanistan.  Mr. Wyatt only represented Dr. DeLia at sentencing and on appeal.  The Tenth Circuit Court of Appeals agreed with Wyatt’s arguments, reversing the conviction with orders to dismiss the case.  This was also a case of first impression–dealing with the Wartime Suspension of Limitations Act (WSLA).   Bob Wyatt and Stephanie Miller briefed the case; Bob argued the appeal. United States v. DeLia, 906 F.3d 1212 (10th Cir. 2018)