Defining "Willful" Remuneration: How Bryan V. United States Affects the Scienter Requirement of the Medicare/medicaid Anti-Kickback Statute
DeGraw, Robb, Journal of Law and Health
The General Accounting Office and the Department of Health and Human Services (the "DHHS") recently estimated that Medicare pays $23 billion a year in fraudulent medical claims. (1) Not surprisingly, many health care professionals consider Medicare fraud and abuse the leading health care issue in 1999. (2) To combat the fraud abuse in the system, Congress has recently enacted several new laws and given life to some old ones. For example, Congress recently passed the Stark laws (3) the 1981 Civil Monetary Penalties Law, (4) and the Health Insurance Portability and Accountability Act. (5) In addition, the False Claims Act, originally enacted in 1863 with a qui tam provision, has become a major force in assisting the government in discovering and prosecuting fraudulent claims. (6) Considerable emphasis has also been placed on prosecuting fraud and abuse under the federal Medicare and Medicaid anti-kickback statute. (7) This Note examines the recent split in federal courts' interpretation of the scienter requirement of the anti-kickback statute and how the Supreme Court's recent definition of "willfully" in Bryan v. United States, (8) will impact the mens rea requirement for conviction under the anti-kickback statute.
State and federal anti-kickback laws aim to prohibit the exchange of remuneration for referrals of patients, goods, or services under publicly funded health care programs. The premise of these laws is if a medical professional has a financial incentive for referring patients, he is more likely to increase the number of services performed. This incentive, in turn, will lead to an overutilization of services, the unnecessarily depletion of program funds, and a waste of taxpayer dollars. (9) Although many state laws contain similar provisions, this Note focuses solely on the federal Medicare and Medicaid anti-kickback statute. (10)
The anti-kickback statute has been the source of much controversy. Supporters of the law argue that it is necessary to punish providers who would contribute to the nation's spiraling health care costs by placing profit over the best interests of their patients. On the other hand, medical providers fear that the anti-kickback laws will punish "innocent" referral arrangements used throughout the industry. Furthermore, it has been argued that these arrangements may ultimately save taxpayers dollars because of the efficiencies which they create. (11) For example, if a hospital owns a management service organization (MSO) that furnishes support services to a physician practice, the hospital may be in violation of the anti-kickback statute if it charges less than the fair market value for the services it provides to the MSO on the theory that such savings are "remuneration" to induce referrals. (12)
At the forefront of the debate over the anti-kickback statute, and the topic of this Note, is the mens rea, or mental state, that is required for a violation of the law. According to the statute, an individual must "knowingly and willfully" solicit or receive, or offer or pay, remuneration in order to induce business reimbursed under any federal health care program. (13) The interpretation of these terms by the federal courts has varied wildly, as have the underlying Supreme Court cases cited as precedent for such interpretations. However, in June of 1998, the Supreme Court defined the meaning of "willfully" under a federal criminal statute in Bryan v. United States. (14) Although the criminal statute in Bryan was unrelated to health care fraud, the Eleventh Circuit has adopted the Bryan Court's definition of "willfully" in a case involving the anti-kickback statute. (15) Whether Bryan will resolve the split between the circuit courts is unclear; however, this case is certain to significantly influence the debate.
The following Section of this Note briefly summarizes the legislative development of the federal anti-kickback statute including the 1980 amendment adding the mens rea requirement. …