McGuireWoods Partners Examine Federal Prosecution of Commercial Healthcare Fraud

August 9, 2023

A recent 11th U.S. Circuit Court of Appeals opinion demonstrates the federal government’s interest in prosecuting medical providers who defraud commercial healthcare insurers, McGuireWoods partners Michael Podberesky and Timothy Fry wrote in an Aug. 7, 2023, article in Thomson Reuters Westlaw.

In May 2023, the 11th Circuit upheld a $1.195 million restitution order and 48-month sentence against a physician assistant for three counts of healthcare fraud. Federal prosecutors brought the case alleging he produced fraudulent patient files and sought reimbursement for commercial healthcare insurance for physical therapy treatments never performed.

United States v. Verdeza “demonstrates that the government can and will prosecute an individual for committing acts of healthcare fraud against a private company,” the authors wrote.

“This case is a good reminder for the healthcare industry that while federal law enforcement efforts are mainly focused on fraud committed against federal healthcare programs, the government has the ability, resources, and motivation to prosecute cases of blatant fraud committed against private entities as well,” the authors explained. “As such, in many instances, carving out Medicare and Medicaid beneficiaries from a problematic scheme will not immunize misconduct and could be used as evidence of knowledge in a future prosecution.”

Podberesky co-chairs McGuireWoods’ False Claims Act investigations, litigation and enforcement team and Fry is a partner in the firm’s Healthcare Department. Their analysis was originally published on The FCA Insider, McGuireWoods’ blog covering False Claims Act litigation issues.