The Department of Justice (DOJ) aims to use its Elder Justice Initiative to pursue more criminal charges in nursing home investigations. Typically, the DOJ uses civil lawsuits to pursue False Claims Act violations against nursing homes. Toni Bacon, a DOJ associate deputy general, explains the shift: "We need to go after cases civilly because they [are] providing grossly substandard care and, in the appropriate case, refer it for a parallel criminal prosecution."
Potential criminal charges that could be pursued alongside a false claims case include wire fraud and healthcare fraud. For example, submitting claims to Medicare or Medicaid for services that were not actually provided constitutes criminal wire fraud.
The long-term care industry has already seen some criminal enforcement. Philip Esformes, owner of multiple assisted living and skilled nursing facilities, was recently convicted for his role in a $1.3 billion Medicare and Medicaid fraud and kickback scheme. Esformes bribed doctors to admit patients to his facilities; billed Medicare and Medicaid for services that were not provided or that were medically unnecessary; and provided inadequate care. Esformes also bribed a state regulator to receive notice of state inspections. Esformes was sentenced to 20 years in prison.
Another reason to invest in compliance
The DOJ's increased interest in pursuing criminal charges against nursing homes provides another compelling reason to invest in an effective compliance program. While CMS' delay of enforcement of Phase 3 compliance requirements has some providers waiting to invest in compliance, the DOJ's announcement is a warning. Even though Phase 3's Compliance and Ethics program requirements might not be enforced via state survey until 2020, federal enforcement of compliance laws remains high. Use your compliance policies and training programs to prevent false claims; and your auditing and reporting systems to detect and correct (and self-report) false claims - before they amount to a civil or criminal matter.