NATIONALLY RECOGNIZED FEDERAL LAWYERS
Philadelphia Medicaid Fraud Lawyer
|Last Updated on: 5th October 2025, 06:12 pm
Your practice just received a $2.3 million overpayment demand based on reviewing 30 claims out of 10,000. The government’s statistical extrapolation assumes those 30 claims represent your entire practice. But their sample selection violated basic statistical principles.
They cherry-picked high-dollar claims. They mixed different service types. They included claims from providers who left your practice years ago. Each error undermines the extrapolation’s validity. Yet most attorneys just negotiate the amount rather than challenging the methodology.
The 60-Day Rule Trap
The Affordable Care Act requires reporting and returning overpayments within 60 days of identification. Most providers think this means 60 days from when they discover an error. It doesn’t.
“Identification” happens when you should have known through reasonable diligence. If your billing patterns were flagged two years ago but you didn’t investigate, the 60-day clock started then. Failing to report converts simple overpayment into False Claims Act liability with triple damages.
But here’s the opportunity: voluntary disclosure within those 60 days often prevents criminal prosecution. Prosecutors rarely pursue criminal charges against providers who self-report. The key is beating the investigation to disclosure.
Using RAC Appeals to Prevent Criminal Referral
Recovery Audit Contractors (RACs) find overpayments and take a percentage. They’re incentivized to find problems whether they exist or not. Most providers pay RAC demands to avoid hassle. This is a mistake.
RAC determinations aren’t binding on criminal prosecutors, but they influence referral decisions. Successfully appealing RAC findings creates a paper trail showing disputed issues, not admitted fraud. This documentation becomes your defense if criminal investigation follows.
The five levels of RAC appeal each serve strategic purposes. Redetermination challenges facts. Reconsideration introduces new evidence. ALJ hearings create testimonial records. Medicare Appeals Council reviews legal issues. Federal court establishes precedent. Each level builds your defensive narrative.
The Physician’s Practice Versus Entity Liability
Most Medicare fraud investigations target both individual physicians and their practice entities. But entity liability requires specific proof that corporate culture encouraged fraud. This is harder to establish than individual misconduct.
Smart defense attorneys separate individual and entity representation early. What helps the practice might hurt the physician. What protects the doctor might expose the entity. Conflicts emerge quickly in joint representation.
The strategic move is aggressive entity compliance remediation. Implement new billing systems. Fire problematic staff. Hire compliance officers. Show the entity rejected any individual’s misconduct. This can eliminate entity liability even if individuals face charges.
Statistical Neighbors and Comparative Billing
Medicare uses “statistical neighbors” to identify outliers. They compare your billing to similar practices. But their similarity metrics are flawed.
They group practices by specialty code, not actual practice patterns. A sports medicine orthopedist gets compared to joint replacement surgeons. A geriatric psychiatrist gets grouped with child psychiatrists. The comparisons are meaningless.
The defense is creating your own peer group. Identify practices that actually resemble yours. Same patient demographics. Same procedure mix. Same geographic challenges. Show that compared to true peers, your billing is normal.
The Modifier 25 Problem
Modifier 25 allows billing separate E/M services with procedures. Medicare considers overuse fraudulent. But they’ve never defined “overuse.”
Some practices use modifier 25 on 80% of procedures. Others use it 5% of the time. Medicare flags both as suspicious – one too high, one too low. There’s no safe harbor.
The defense isn’t arguing your percentage is correct. It’s showing medical necessity for each use. Document the separate clinical decision-making. Note the distinct documentation. Demonstrate that each E/M service involved work beyond the procedure’s inherent evaluation.
Turning Qui Tam Relators Into Defense Witnesses
Whistleblower cases under the False Claims Act provide relators with 15-30% of recoveries. But relators often have credibility problems prosecutors downplay.
Discovery in qui tam cases reveals relator motivations. Fired employees seeking revenge. Competitors trying to damage your practice. Ex-partners in business disputes. These motivations don’t invalidate their claims, but they matter to juries.
More importantly, relators often lack actual knowledge of billing processes. They assume fraud from incomplete information. Deposing relators early reveals knowledge gaps. Their speculation becomes your reasonable doubt.
The Compliance Program Safe Harbor
Having a compliance program doesn’t immunize you from prosecution. But effective compliance programs influence charging decisions.
The key is showing the program actually functioned. Regular audits that found and fixed problems. Hotlines that received and investigated reports. Training that changed behavior. Discipline that enforced standards.
Document compliance program effectiveness before investigation starts. Create audit trails showing continuous improvement. Demonstrate that any violations occurred despite compliance efforts, not because of their absence.
Parallel Proceedings Coordination
Healthcare fraud triggers multiple proceedings. Criminal investigation. Civil False Claims Act. Administrative sanctions. State licensing board. Hospital privilege reviews. Each uses different standards and timelines.
Information shared in one proceeding affects others. Your explanation to the licensing board becomes evidence in criminal court. Your criminal defense conflicts with civil settlement. Your hospital peer review statements undermine administrative appeals.
The solution is coordinated defense across all forums. Sometimes stonewalling one proceeding protects others. Sometimes cooperation in one forum prevents worse consequences elsewhere. The strategy depends on understanding how proceedings interconnect.
The EHR Documentation Defense
Electronic Health Records create unexpected defenses. Every entry is timestamped. Every access is logged. Every change is tracked. This metadata tells stories prosecutors don’t expect.
Billing entries made months after service suggest confusion, not contemporary fraud intent. Templates used across all patients show systematic issues, not targeted fraud. Copy-paste documentation indicates laziness, not criminal intent.
The key is preserving EHR audit trails before investigation begins. Many systems purge logs after set periods. Once gone, this defensive evidence disappears forever.
Using CDC Guidelines Defensively
The CDC Opioid Prescribing Guidelines aren’t law, but prosecutors treat them as standards. Exceeding CDC recommendations triggers scrutiny.
But the guidelines themselves acknowledge exceptions. Cancer patients. Palliative care. Medication tolerance. Genetic variations affecting metabolism. Each exception provides defense against “excessive” prescribing claims.
Document guideline exceptions contemporaneously. Note why standard recommendations don’t apply to specific patients. Create records showing thoughtful deviation, not ignorant violation.
The Negotiation Timeline
Healthcare fraud negotiations follow predictable patterns. Initial shock demand. Documentary submission. Revised calculation. Settlement discussion. Final resolution.
Each stage offers strategic opportunities. Initial demands are negotiating positions, not final numbers. Documentary submissions shape narrative. Revised calculations reveal government priorities. Settlement discussions test resolve.
The key is patience. Government attorneys have quotas and timelines. As deadlines approach, settlement terms improve. Rushing to resolve gives up leverage. Strategic delay often yields better outcomes.
Moving Forward
Healthcare fraud investigations feel overwhelming because they threaten everything. Your license. Your livelihood. Your liberty. The natural response is panic.
But understanding the process reveals opportunities. Statistical sampling errors that invalidate extrapolations. Compliance programs that demonstrate good faith. EHR metadata that shows confusion over conspiracy. Each provides leverage in negotiations.
The key is recognizing that healthcare fraud cases are rarely black and white. They’re about interpretation of complex regulations. About line-drawing in gray areas. About whether mistakes were innocent or intentional. These ambiguities create defensive opportunities for those who understand how to exploit them.