Tonacchio Law LC

30:4D-17, Medicaid Fraud

If you have been notified that you have been accused of violating NJSA 30:4D-17, you could be facing very serious criminal consequences in addition to civil penalties.  These cases do not unfold like your typical criminal case.  That is, it is very unlikely that the first indication that there is an issue will be an arrest.  Instead, you may get a phone call, a knock on the door or more likely, a letter.  How you handle this initial interaction can make the difference between arrest and a dismissal.  Too many people also think that if they hire a lawyer, they will look guilty.  Wrong!  They may already think you are guilty.  Hiring a lawyer will not change how they think about the case.  Calling a lawyer is the smartest thing you can do because anything you say or do can be used against you.  Call our team of tough, smart attorneys now to discuss your case.

17. (a) Any person who willfully obtains benefits under P.L.1968, c.413 (C.30:4D-1 et seq.) to which a person is not entitled or in a greater amount than that to which a person is entitled and any provider who willfully receives medical assistance payments to which a provider is not entitled or in a greater amount than that to which a provider is entitled is guilty of a crime of the third degree, provided, however, that the presumption of nonimprisonment set forth in subsection e. of N.J.S.2C:44-1 for persons who have not previously been convicted of an offense shall not apply to a person who is convicted under the provisions of this subsection.

(b) Any provider, or any person, firm, partnership, corporation, or entity, who:

(1) Knowingly and willfully makes or causes to be made any false statement or representation of a material fact in any cost study, claim form, or any document necessary to apply for or receive any benefit or payment under P.L.1968, c.413; or

(2) At any time knowingly and willfully makes or causes to be made any false statement, written or oral, of a material fact for use in determining rights to such benefit or payment under P.L.1968, c.413; or

(3) Conceals or fails to disclose the occurrence of an event which

(i) affects a person’s initial or continued right to any such benefit or payment, or

(ii) affects the initial or continued right to any such benefit or payment of any provider or any person, firm, partnership, corporation, or other entity in whose behalf a person has applied for or is receiving such benefit or payment with an intent to fraudulently secure benefits or payments not authorized under P.L.1968, c.413 or in a greater amount than that which is authorized under P.L.1968, c.413; or

(4) Knowingly and willfully converts benefits or payments or any part thereof received for the use and benefit of any provider or any person, firm, partnership, corporation, or other entity to a use other than the use and benefit of such provider or such person, firm, partnership, corporation, or entity; is guilty of a crime of the third degree, provided, however, that the presumption of nonimprisonment set forth in subsection e. of N.J.S.2C:44-1 for persons who have not previously been convicted of an offense shall not apply to a person who is convicted under the provisions of this subsection.

(c) Any provider, or any person, firm, partnership, corporation, or entity who solicits, offers, or receives any kickback, rebate, or bribe in connection with:

(1) The furnishing of items or services for which payment is or may be made in whole or in part under P.L.1968, c.413; or

(2) The furnishing of items or services whose cost is or may be reported in whole or in part in order to obtain benefits or payments under P.L.1968, c.413; or

(3) The receipt of any benefit or payment under this act, is guilty of a crime of the third degree, provided, however, that the presumption of nonimprisonment set forth in subsection e. of N.J.S.2C:44-1 for persons who have not previously been convicted of an offense shall not apply to a person who is convicted under the provisions of this subsection.

This subsection shall not apply to (A) a discount or other reduction in price under P.L.1968, c.413 if the reduction in price is properly disclosed and appropriately reflected in the costs claimed or charges made under P.L.1968, c.413; and (B) any amount paid by an employer to an employee who has a bona fide employment relationship with such employer for employment in the provision of covered items or services.

(d) Whoever knowingly and willfully makes or causes to be made or induces or seeks to induce the making of any false statement or representation of a material fact with respect to the conditions or operations of any institution or facility in order that such institution or facility may qualify either upon initial certification or recertification as a hospital, skilled nursing facility, intermediate care facility, or health agency, thereby entitling them to receive payments under P.L.1968, c.413, shall be guilty of a crime of the fourth degree.

(e) Any person, firm, corporation, partnership, or other legal entity who violates the provisions of any of the foregoing subsections of this section or any provisions of section 3 of P.L.2007, c.265 (C.2A:32C-3), shall, in addition to any other penalties provided by law, be liable to civil penalties of: (1) payment of interest on the amount of the excess benefits or payments at the maximum legal rate in effect on the date the payment was made to said person, firm, corporation, partnership or other legal entity for the period from the date upon which payment was made to the date upon which repayment is made to the State; (2) payment of an amount not to exceed three-fold the amount of such excess benefits or payments; and (3) payment in the sum of not less than and not more than the civil penalty allowed under the federal False Claims Act (31 U.S.C. s.3729 et seq.), as it may be adjusted for inflation pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990, Pub.L.101-410 for each excessive claim for assistance, benefits or payments.

(f) Any person, firm, corporation, partnership, or other legal entity, other than an individual recipient of medical services reimbursable by the Division of Medical Assistance and Health Services, who, without intent to violate P.L.1968, c.413, obtains medical assistance or other benefits or payments under P.L.1968, c.413 in excess of the amount to which he is entitled, shall be liable to a civil penalty of payment of interest on the amount of the excess benefits or payments at the maximum legal rate in effect on the date the benefit or payment was made to said person, firm, corporation, partnership, or other legal entity for the period from September 15, 1976 or the date upon which payment was made, whichever is later, to the date upon which repayment is made to the State, provided, however, that no such person, firm, corporation, partnership, or other legal entity shall be liable to such civil penalty when excess medical assistance or other benefits or payments under this act are obtained by such person, firm, corporation, partnership, or other legal entity as a result of error made by the Division of Medical Assistance and Health Services, as determined by said division; provided, further, that if preliminary notification of an overpayment is not given to a provider by the division within 180 days after completion of the field audit as defined by regulation, no interest shall accrue during the period beginning 180 days after completion of the field audit and ending on the date preliminary notification is given to the provider.

(g) All interest and civil penalties provided for in P.L.1968, c.413 and all medical assistance and other benefits to which a person, firm, corporation, partnership, or other legal entity was not entitled shall be recovered in an administrative proceeding held pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), except that recovery actions against minors or incapacitated persons shall be initiated in a court of competent jurisdiction.

(h) Upon the failure of any person, firm, corporation, partnership, or other legal entity to comply within 10 days after service of any order of the director or the director’s designee directing payment of any amount found to be due pursuant to subsection (g) of this section, or at any time prior to any final agency adjudication not involving a recipient or former recipient of benefits under P.L.1968, c.413, the director may issue a certificate to the clerk of the Superior Court that such person, firm, corporation, partnership, or other legal entity is indebted to the State for the payment of the amount. A copy of such certificate shall be served upon the person, firm, corporation, partnership, or other legal entity against whom the order was entered. Thereupon the clerk shall immediately enter upon the record of docketed judgments the name of the person, firm, corporation, partnership, or other legal entity so indebted, and of the State, a designation of the statute under which such amount is found to be due, the amount due, and the date of the certification. Such entry shall have the same force and effect as the entry of a docketed judgment in the Superior Court. Such entry, however, shall be without prejudice to the right of appeal to the Appellate Division of the Superior Court from the final order of the director or the director’s designee.

(i) In order to satisfy any recovery claim asserted against a provider under this section, whether or not that claim has been the subject of final agency adjudication, the division or its fiscal agents is authorized to withhold funds otherwise payable under P.L.1968, c.413 to the provider.

(j) The Attorney General may, when requested by the commissioner or the commissioner’s agent, apply ex parte to the Superior Court to compel any party to comply forthwith with a subpoena issued under P.L.1968, c.413. Any party who, having been served with a subpoena issued pursuant to the provisions of P.L.1968, c.413, fails either to attend any hearing, or to appear or be examined, to answer any question or to produce any books, records, accounts, papers or documents, shall be liable to a penalty of $500 for each such failure, to be recovered in the name of the State in a summary civil proceeding to be initiated in the Superior Court. The Attorney General shall prosecute the actions for the recovery of the penalty prescribed in this section when requested to do so by the commissioner or the commissioner’s agent and when, in the judgment of the Attorney General, the facts and law warrant such prosecution. Such failure on the part of the party shall be punishable as contempt of court by the court in the same manner as like failure is punishable in an action pending in the court when the matter is brought before the court by motion filed by the Attorney General and supported by affidavit stating the circumstances.

(k) Notwithstanding the provisions of N.J.S.2C:43-3 to the contrary, but in addition to any other penalty or disposition that may be imposed by law:

(1) a person who violates the provisions of subsection (a), (b), or (c) of this section shall be liable to a penalty of not less than $15,000 and not more than $25,000 for each violation; and

(2) a person who violates the provisions of subsection (d) of this section shall be liable to a penalty of not less than $10,000 and not more than $25,000 for each violation.

(l) A person who violates the provisions of subsection (a), (b), or (c) of this section under circumstances in which the aggregate amount obtained or sought to be obtained is $1,000 or more, who has previously been convicted of a violation of the provisions of subsection (a), (b), or (c) of this section within 10 years of the current violation, under circumstances where the aggregate amount obtained or sought to be obtained was $1,000 or more, is guilty of a crime of the second degree and, in addition to any other penalty or disposition authorized by law and notwithstanding the provisions of N.J.S.2C:43-3 to the contrary, shall be liable to a penalty of not less than $25,000 and not more than $150,000 for each such repeat violation.