Houston Federal Healthcare Fraud Defense Lawyer

A federal healthcare fraud charge under 18 U.S.C. § 1347 usually means the government believes someone knowingly participated in a plan to obtain money from Medicare, Medicaid, TRICARE, a private health insurer, or another healthcare benefit program through false or fraudulent claims.

These cases may involve allegations of billing for services that were not provided, medically unnecessary treatment, false diagnoses, improper coding, fraudulent prescriptions, or claims submitted using inaccurate patient or provider information. Because healthcare fraud is a federal felony, a conviction may lead to prison, restitution, substantial fines, exclusion from federal healthcare programs, and damage to a professional license or career.

Being investigated or indicted does not mean the government can prove its case. An experienced federal defense attorney can examine the evidence, challenge the government’s assumptions, and help you make informed decisions before speaking with agents or prosecutors.

What Is Healthcare Fraud? How Federal Law Defines It

The federal healthcare fraud statute is found at 18 U.S.C. § 1347. The law makes it a crime to knowingly and willfully carry out, or attempt to carry out, a scheme:

1. To defraud a healthcare benefit program; or
2. To obtain money or property controlled by a healthcare benefit program through false or fraudulent statements, promises, or representations.

The alleged conduct must be connected to the delivery of, or payment for, healthcare benefits, services, or items. The statute applies to government programs and many private insurance plans. Federal law broadly defines a healthcare benefit program as a public or private plan or contract that provides medical benefits, items, or services. See 18 U.S.C. § 24(b).

To obtain a conviction under § 1347, the government generally must prove beyond a reasonable doubt that:

• A scheme or plan to defraud a healthcare benefit program existed;
• The defendant knowingly and willfully executed, or attempted to execute, that scheme;
• The scheme involved false or fraudulent claims, statements, promises, or conduct;
• The false or fraudulent information was material to the healthcare program’s payment decision; and
• The conduct was connected to the delivery of or payment for healthcare benefits, items, or services.

The government does not have to prove that the defendant personally submitted every claim. Prosecutors may argue that an owner, physician, manager, marketer, biller, or other participant caused false claims to be submitted or knowingly helped another person carry out the alleged scheme.

Common healthcare fraud allegations include:

• Billing for services that were never performed;
• Billing for medically unnecessary services or equipment;
• Upcoding a service to obtain a higher payment;
• Unbundling services that should have been billed together;
• Falsifying patient records or diagnoses;
• Billing under another provider’s identification number;
• Using improper physician certifications or orders;
• Submitting claims for patients obtained through illegal kickbacks;
• Misrepresenting who performed a service;
• Billing for services that did not meet Medicare or Medicaid coverage rules; and
• Using telemedicine, laboratory, pharmacy, home-health, hospice, or durable medical equipment arrangements to generate improper claims.

Not every billing error is healthcare fraud. Section 1347 requires proof that the defendant acted knowingly and willfully. Mistakes, poor recordkeeping, coding disputes, employee misconduct, and reasonable interpretations of complex billing rules may present very different issues from intentional fraud.

Penalties and Consequences

A standard violation of 18 U.S.C. § 1347 carries a maximum prison sentence of 10 years for each count. If the violation results in serious bodily injury, the maximum increases to 20 years. If the violation results in death, the statute permits a sentence of any term of years or life imprisonment.

There is no mandatory minimum prison sentence for an ordinary § 1347 conviction. The actual sentencing range is usually calculated under the Federal Sentencing Guidelines and depends on the facts of the case.

Important sentencing factors may include:

• The amount of actual or intended financial loss;
• The number of claims or patients involved;
• The defendant’s role in the alleged scheme;
• Whether the conduct involved sophisticated means;
• Whether the defendant abused a position of trust or used a professional skill;
• Whether medical services created a risk of bodily injury;
• Whether records were altered or evidence was obstructed;
• Whether the defendant accepted responsibility; and
• The defendant’s criminal history.

Under federal law, an individual convicted of a felony may generally face a fine of up to $250,000, or a higher alternative fine based on twice the gross financial gain or twice the gross financial loss caused by the offense. An organization may generally face a fine of up to $500,000 or the applicable alternative amount.

A court may also order:

• Restitution: Repayment of losses attributed to the offense, often to Medicare, Medicaid, TRICARE, or a private insurer;
• Supervised release: Federal supervision after release from prison, commonly for up to three years for an ordinary 10-year § 1347 offense;
• Forfeiture: Loss of money, bank accounts, real estate, vehicles, or other property allegedly derived from the offense;
• Special assessments and court-imposed conditions; and
• Restrictions on employment, business activity, finances, or contact with healthcare programs.

Federal restitution is often mandatory in fraud cases when the statutory requirements are met.

The consequences can extend beyond the criminal sentence. Physicians, nurses, pharmacists, clinic owners, and other healthcare professionals may face:

• Exclusion from Medicare and other federal healthcare programs;
• Suspension or loss of a professional license;
• Loss of hospital privileges;
• Employment termination;
• Civil False Claims Act litigation;
• Administrative penalties;
• Loss of contracts or provider enrollment;
• Immigration consequences for noncitizens; and
• Long-term damage to a professional reputation or business.

Defense Strategies

The appropriate defense depends on the records, witnesses, billing rules, contracts, medical evidence, and the defendant’s role. An attorney may explore several approaches.

Lack of knowledge or intent

The government must prove knowing and willful conduct. A defense may focus on whether the defendant reasonably relied on employees, coders, billing companies, compliance staff, physicians, or outside consultants.

Billing errors rather than fraud

Healthcare billing rules are complicated. Incorrect codes, incomplete documentation, changing regulations, software errors, and disagreements over medical necessity do not automatically establish criminal intent.

Services were medically necessary and provided

Medical records, patient histories, physician testimony, clinical guidelines, and expert opinions may support that the care was legitimate, necessary, and properly delivered.

The defendant did not control the claims

A person’s title or ownership interest does not necessarily prove knowledge of each billing decision. The evidence may show that another employee, provider, marketer, or billing company controlled the challenged conduct.

Good-faith interpretation of unclear rules

Medicare, Medicaid, and insurer rules can be technical or ambiguous. A reasonable, good-faith interpretation of a regulation or billing requirement may undermine an allegation of intentional fraud.

Unreliable witnesses

Federal healthcare investigations often depend on cooperating witnesses, former employees, marketers, or alleged co-conspirators. Their statements should be tested against records, financial evidence, prior statements, and any benefit they expect from the government.

Incorrect loss calculation

The government’s claimed loss can heavily influence sentencing and plea negotiations. An attorney may challenge whether claims were actually false, whether services had value, whether payments were refunded, and whether the alleged loss was reasonably foreseeable to the defendant.

Unlawful search or seizure

Depending on the facts, the defense may examine warrants, subpoenas, electronic searches, recorded communications, interviews, and the seizure of medical or financial records for constitutional or procedural violations.

Why Timing Matters

Federal healthcare fraud investigations may continue for months or years before an indictment. Investigators may use subpoenas, search warrants, audits, interviews, cooperating witnesses, data analysis, and financial records before the target knows the full scope of the case.

Hiring counsel early may allow the attorney to communicate with agents and prosecutors, determine whether the client is considered a witness, subject, or target, preserve favorable records, prepare for interviews, and discourage the client from making damaging statements.

Early representation may also provide an opportunity to explain billing practices, identify inaccurate assumptions, present medical or compliance evidence, or address the case before charging decisions are final. Once an indictment is returned, the defense must quickly address bond, discovery, electronic evidence, expert review, forfeiture, and sentencing exposure.

Why Choose James Alston

James Alston is a Board Certified criminal defense attorney with more than 30 years of experience. He previously served as an Assistant United States Attorney and as a Harris County prosecutor, giving him experience with federal investigations and criminal prosecutions from both sides of the courtroom.

Frequently Asked Questions

Can I be charged with healthcare fraud if I did not personally submit the claim?

Yes. Prosecutors may allege that you caused a claim to be submitted, directed another person, approved the practice, or knowingly helped carry out the scheme. The defense should closely examine what you actually knew, what authority you had, and who controlled the billing process.

Is a Medicare billing mistake automatically a federal crime?

No. A mistake, coding error, documentation problem, or disagreement over coverage is not automatically fraud. The government must prove beyond a reasonable doubt that you acted knowingly and willfully as part of a fraudulent scheme.

Should I speak with an FBI or HHS-OIG agent?

No. You should generally consult a federal criminal defense attorney before agreeing to an interview. Even truthful people may make incomplete, inaccurate, or misunderstood statements when questioned without knowing the government’s evidence or theory.

What if I relied on a billing company or compliance consultant?

Good-faith reliance may be important, especially when the defendant disclosed the relevant facts and followed professional advice. The value of this defense depends on the communications, contracts, warnings, records, and the extent of the defendant’s own knowledge.

How is the alleged loss calculated?

The government may begin with amounts billed, paid, or allegedly intended to be obtained. The defense may argue that legitimate services had value, that certain claims were proper, that payments were returned, or that some losses were not caused or reasonably foreseeable.

Can a healthcare fraud case be resolved without prison?

There is no mandatory minimum sentence for an ordinary § 1347 charge, but no attorney can promise a particular result. The outcome depends on the evidence, loss amount, Guidelines calculation, criminal history, role in the offense, plea or trial decisions, and the sentencing judge.

Speak With a Houston Federal Healthcare Fraud Defense Attorney

A federal healthcare fraud investigation can affect your freedom, license, business, and reputation. Do not wait until agents have completed their investigation or prosecutors have decided how to charge the case.

Contact the Law Offices of James Alston at 713-228-1400 to request a confidential consultation about a federal healthcare fraud investigation or indictment in Houston or the Southern District of Texas.