Civil investigations can have enormous repercussions on the viability of any health care company and on the livelihood of the individuals involved. In addition, civil and criminal investigative agencies often work hand in hand sharing information throughout the process.
At Elliott Sauter, our first priority is to make sure that civil investigations stay civil—preventing them from morphing into a criminal investigation. We then assist clients in working toward a fast and favorable resolution recognizing that the sooner the matter is resolved, the faster clients can refocus on the day-to-day operation of their business.
In 2016, the Department of Justice opened 930 new civil health care fraud investigations. These investigations resulted in the federal government recovering $2.5 billion in judgments and settlements.
What Laws Give Rise to Civil Investigations?
Health care fraud investigations often use several statutes. However, the most common are violations of HIPAA and the False Claims Acts.
The Health Insurance Portability and Accountability Act (HIPAA) revolutionized United States privacy laws in the health care industry. It also provided strict fines for those who did not follow those guidelines.
The False Claims Act (FCA) is one of the primary bases supporting federal civil health care investigations. Generally, the FCA prohibits individuals and entities from taking or keeping federal money through false or fraudulent means.
The Qui Tam and the Beginning of a Civil Investigation
While some civil investigations originate with the government’s own data analysis, the more common origin is as the result of a qui tam lawsuit, filed by a whistleblower. Under the FCA, private individuals with evidence of a false claim submitted to the government may file suit on behalf of the government and may be entitled to a substantial percentage of any recovery resulting from the suit. The Department of Justice investigates the allegations in the qui tam and may choose to intervene and participate in the lawsuit or to permit the whistleblower to pursue the lawsuit on their own.
The Civil Investigative Demand (CID)
Qui tam investigations are filed under seal, and in many instances, the company and individuals that are the subject of the qui tam are entirely unaware of the government’s investigation for months or even years. In some instances, a company may hear rumors of the government’s investigation (like learning that former employees have been contacted by the government), but in many cases, receipt of a civil investigative demand is the first notice a company receives that it is under investigation. A CID, authorized under 31 U.S.C. § 3733(a)(1), is a request for documents and other evidence that may be relevant to an ongoing FCA investigation. These requests are often expansive, and compliance with the CID can be difficult and expensive. An experienced attorney can assist in limiting the scope of the CID and its response.
Responding to a Civil Investigation
Whether you have just received a CID, become aware of a qui tam, or have other reason to believe that your company is under investigation, it is vital that you contact an attorney. Your attorney can help you conduct an internal investigation and address any issues that are discovered. If necessary, they can assist you in modifying the scope and responding to any CIDs.
Both founders of Elliott Sauter have served in various capacities for the Department of Justice working on health care cases. Surround yourself with a seasoned, experienced law firm who can help you navigate through your health care civil defense case.