LEGAL ISSUES IN HEALTH CARE FRAUD AND ABUSE: ENFORCEMENT AND COMPLIANCE
AMERICAN UNIVERSITY WASHINGTON COLLEGE OF LAW
PROF. DEREK KUNG AND KRISTI KUNG
FALL 2015 – 3 CREDITS
TUESDAYS 9:00 A.M. – 11:40 A.M.
INTRODUCTION AND COURSE DESCRIPTION: This Course will cover the health care fraud and
abuse laws and regulations relating to the prosecution and defense of alleged wrongdoing by
health care providers and suppliers. The Course will provide a basic overview of the laws
governing healthcare providers and suppliers, such as hospitals, physicians and physician
practices, clinical laboratories, medical device and pharmaceutical manufacturers, and nursing
homes.
This Course explores the implications of the federal and state Anti-Kickback Laws, the federal
anti-referral (Stark) law, the federal civil monetary penalty and exclusion laws, the federal and
state false claims laws, as well as traditional federal white collar criminal laws as applied to
health care. Emphasis will be placed on the federal laws but state law issues will also be
considered.
In addition, this Course will consider voluntary and mandatory fraud and abuse compliance as
well as the complexities and challenges that arise in developing and maintaining an effective
compliance program.
This Course is designed to be interactive, with assigned reading and lectures to be supplemented
with hypotheticals and short presentations. Some of the class work may be assigned in teams.
Guest lecturers from both the government and private practice will share their perspectives on
compliance and enforcement.
COURSE REQUIREMENTS AND GRADING: Class attendance and active participation are expected.
a.
Class participation/Written Memos/Presentations (30% of Grade) -- Students
are expected to attend all classes in their entirety, read the course materials in preparation for
class discussion, participate actively in group discussions and mock client exercises, and
complete written assignments and/or oral presentations as assigned.
b.
Final Exam (70% of Grade) – The final exam will consist of short answer
questions and hypotheticals. Students may use Course Reading Materials and class notes in
completing the exam.
COURSE READING MATERIALS: There is no mandatory textbook for this course. Required
reading materials primarily consist of statutes, regulations and case law, along with federal and
state agency guidance, and other publicly available materials. All such materials are available
on-line or will be distributed in class.
SHARING OF COURSE CONTENT: Students are not permitted to make visual or audio recordings,
including live streaming, of classroom lectures or any class related content, using any type of
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recording devices (e.g., smart phone, computer, digital recorder, etc.) unless prior permission
from the instructor is obtained, and there are no objections from any of the students in the class.
If permission is granted, personal use and sharing of recordings and any electronic copies of
course materials (e.g., PowerPoints, formulas, lecture notes and any classroom discussions online
or otherwise) is limited to the personal use of students registered in the course and for
educational purposes only, even after the end of the course.
Exceptions will be made for students who present a signed Letter of Accommodation from the
Academic Support and Access Center. See: How Do I Request Accommodations?
http://www.american.edu/ocl/asac/Accommodations.cfm
Faculty may record classroom lectures or discussions for pedagogical use, future student
reference, or to meet the accommodation needs of students with a documented disability. These
recordings are limited to personal use and may not be distributed (fileshare), sold, or posted on
social media outlets without the written permission of faculty.
Unauthorized downloading, file sharing, distribution of any part of a recorded lecture or course
materials, or using information for purposes other than the student’s own learning may be
deemed a violation of American University’s Student Conduct Code and subject to disciplinary
action (see Student Conduct Code VI. Prohibited Conduct). Sharing of class notes is not
prohibited.
CONTACT INFORMATION:
Derek Kung, Esq.
General Counsel, MedAssist
Derek.Kung@medassistsolutions.com
(202) 421-1155
Kristi Kung, Esq.
Pillsbury Winthrop Shaw Pittman
Kristi.Kung@pillsburylaw.com
(804) 332-0440
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LEGAL ISSUES IN HEALTH CARE FRAUD AND ABUSE: ENFORCEMENT AND COMPLIANCE
AMERICAN UNIVERSITY WASHINGTON COLLEGE OF LAW
PROF. DEREK KUNG AND KRISTI KUNG
FALL 2015 – 3 CREDITS
TUESDAYS 9:00 A.M. – 11:40 A.M.
Class 1 (August 25, 2015) – Course overview; Introduction to the U.S. health care system;
Introduction to fraud and abuse.
Course Materials:

Read summaries of HHS Agencies and Operating Divisions, available at:
http://www.hhs.gov/about/agencies/operating-divisions/index.html

Read “A Roadmap for New Physicians, Avoiding Medicare and Medicaid Fraud and
Abuse, Publication of the Department of Health and Human Services Office of Inspector
General”, available at: http://oig.hhs.gov/compliance/physicianeducation/roadmap_web_version.pdf

Read 2014 Health Care Fraud Year in Review, available at:
http://www.bassberry.com/~/media/Files/Publications/2015/03/Healthcare%20Fraud%20
and%20Abuse%20Review%202014.pdf
Class 2 (September 1, 2015) - Anti-Kickback Statute: Prohibition, Penalties, One Purpose Rule,
Scienter Requirement; Safe Harbors; Case Law.
Course Materials:

Read 42 U.S.C. §1320a-7b(b)

Read 42 C.F.R. §1001.951

Read 42 C.F.R. §1001.952(a), (b), (c), (d), (h), (i), (k), (l), (n), (r), and (y)

Read U.S. v. Greber, 760 F.2d 68 (1985)

Read Hanlester Network v. Shalala, 51 F.3d 1390 (1995)
Assignment:

AKS hypotheticals to be distributed at the end of Class 2 and will be discussed in Class 3.
Class 3 (September 8, 2015) – Anti-Kickback Statute considerations in health care transactions;
Valuation issues; State anti-kickback considerations; applicability to different health care
providers and suppliers; in-class hypotheticals.
Course Materials:
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
Read Final Rule: Clarifications of the Initial OIG Safe Harbor Provisions and
Establishment of Additional Safe Harbor Provisions Under the Anti-Kickback Statute (64
Fed. Reg. 63518 (Section I – II.A.1.), 63525 (Section 2 (ends in the middle of 63526)),
63541 (Section C.4. (ends on 63545)); Nov. 19, 1999) available at:
http://www.gpo.gov/fdsys/pkg/FR-1999-11-19/pdf/99-29989.pdf

Read June 25, 2014 Special Fraud Later: Laboratory Payments to Referring Physicians,
available at:
https://oig.hhs.gov/fraud/docs/alertsandbulletins/2014/OIG_SFA_Laboratory_Payments_
06252014.pdf

Read OIG Advisory Opinion (“AO”) 12-22, available at: http://oig.hhs.gov/reports-andpublications/archives/advisory-opinions/

Read AO 12-16

Read AO 05-08

Read AO 11-03

Read AO 15-06
Class 4 (September 15, 2015) - Stark Law and Regulations; exceptions; CMS guidance
Course Materials:



Read 42 U.S.C. §1395nn
Read 42 C.F.R. §§411.350–.357
Read 73 Fed. Reg. 48713-721 (“F. Unit of Service (Per Click) Payments in Lease
Arrangements”) (Aug. 19, 2008) – Physician Self-Referral Provisions, available at:
http://www.gpo.gov/fdsys/pkg/FR-1999-11-19/pdf/99-29989.pdf
Class 5 (September 22, 2015) - Stark Law and Regulations; exceptions; CMS guidance.
Proposed Changes. State considerations. Hypos.
Course Materials:



Read CMS Proposed Changes to PART 411—EXCLUSIONS FROM MEDICARE AND
LIMITATIONS ON MEDICARE PAYMENT – To be distributed.
Skim redline of proposed to current Stark regulations – To be distributed.
Read CMS Advisory Opinion No. 2011-01, available at:
https://www.cms.gov/Medicare/Fraud-andAbuse/PhysicianSelfReferral/Downloads/CMS-AO-2011-01.pdf
Class 6 (September 29, 2015) – Stark Case Law
Course Materials:


Read Singh v. Bradford, 752 F.Supp.2d 602 (W.D. Pa. 2010)
Read Drakeford v. Tuomey (4th Circuit Affirmation)(Pgs. 1-14, 25-39 (stop at IV)),
available at: http://www.sidley.com/~/media/uploads/tuomey.pdf
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

Read Baklid-Kunz v. Halifax Hospital Medical Center, 2013 U.S. Dist. LEXIS 161718;
2013 WL 6017329 (M.D. Fla. Nov. 2013)
Read Council for Urological Interests v. Burwell, No. 13-5235 (D. DC. June 2015)
Assignment: Graded

Mock client hypotheticals for Class 7 to be distributed. Group presentations in Class 7.
Class 7 (October 6, 2015) – Application of the Stark Law and Anti-Kickback Statute to mock
client scenarios.
Graded Assignment: Student presentations.
Class 8 (October 13, 2015) – Administrative Sanctions; Civil Monetary Penalties Law
Course Materials:






Skim 42 U.S.C. §1320a-7a(a)
Read 42 C.F.R. §1003.100 - .106
Skim OIG Updated Special Advisory Bulletin on the Effect of Exclusion from
Participation in Federal Health Care Programs, available at:
http://oig.hhs.gov/exclusions/files/sab-05092013.pdf
Read OIG Special Advisory Bulletin - Offering Gifts and Other Inducements to
Beneficiaries (August 2002) available at:
http://oig.hhs.gov/fraud/docs/alertsandbulletins/SABGiftsandInducements.pdf
Read 79 Fed. Reg. 59717 (Oct. 3, 2014) - Medicare and State Health Care Programs:
Fraud and Abuse; Revisions to Safe Harbors Under the Anti-Kickback Statute, and Civil
Monetary Penalty Rules Regarding Beneficiary Inducements and Gainsharing, available
at: http://www.gpo.gov/fdsys/pkg/FR-2014-10-03/pdf/2014-23182.pdf
Read OIG Advisory Opinions – 09-11, 11-01, 12-05, 13-19, 15-06, available at:
https://oig.hhs.gov/compliance/advisory-opinions/
Class 9 (October 20, 2015) – Medicare Shared Savings Program (Accountable Care
Organizations) Fraud and Abuse Waivers; Stark Law’s application to Medicaid.
Course Materials:


Read Fed. Reg. 67992 (Nov. 2, 2011) – Final Waivers in Connection with Shared
Savings Program, available at: http://www.gpo.gov/fdsys/pkg/FR-2011-11-02/pdf/201127460.pdf
Read “Medicare ACO Participation Waiver of Fraud and Abuse Laws: How It Works and
Why ACOs Should Use It” (Dec. 2014), available at:
http://www.mwe.com/files/Publication/98ab9dc9-e97b-4af8-8853e6597416d207/Presentation/PublicationAttachment/7596b26a-ad97-4d10-a0f7f4701fad056d/AHLA_Connections_1214.pdf?PublicationTypes=d4366db4-cfb3-4a3195e6-f18e3d273c8a
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
Read Section V of the U.S. Government’s Statement of Interest in the Citizens Medical
Center case, Read V of Citizens Medical Center’s Response to the U.S. Statement of
Interest – To be distributed
Class 10 (October 27, 2015) – Guest Lecturers: To Be Determined.
False Claims Act; Elements and Defenses; State False Claims Act considerations; State Medicaid
enforcement.
Course Materials:



Read 31 U.S.C. §§3729–3733
Read U.S. ex rel. Clausen v. Laboratory Corporation of America, Inc., 290 F. 3d 1301
(11th Cir. 2002)
Read Allison Engine Co. v. United States ex rel. Sanders, 128 S. Ct. 2123 (2008)
Assignment: Graded. FCA Fact patterns distributed at the end of Class 10. Due Class 12.

Draft an outline to be submitted to either (1) your supervisor at the DOJ or (2) your
supervising partner, outlining your strongest arguments for either prosecution or defense
of your assigned fact pattern. Bring one copy to turn in beginning of Class 11.
Class 11 (November 3, 2015) - Overview of Health Care Compliance Landscape; Developing
an Effective Compliance Program.
Course Materials:

Read 2012 Federal Sentencing Guidelines Manual, EXCERPT, Chapter 8, Part B,
Section 2, available at
http://www.ussc.gov/Guidelines/2012_Guidelines/Manual_HTML/8b2_1.htm

Skim OIG Compliance Program Guidance for Pharmaceutical Manufacturers, 68 Fed.
Reg. 23731 (May 5, 2003) available at
http://www.oig.hhs.gov/authorities/docs/03/050503FRCPGPharmac.pdf

Skim OIG Supplemental Compliance Program Guidance for Hospitals, 70 Fed. Reg.
4858 (January 31, 2005) available at
http://www.oig.hhs.gov/fraud/docs/complianceguidance/012705HospSupplementalGuida
nce.pdf

Skim OIG Compliance Program Guidance for Laboratories – available at
https://oig.hhs.gov/compliance/compliance-guidance/index.asp

Skim OIG Compliance Program Guidance for Nursing Facilities – available at
https://oig.hhs.gov/authorities/docs/cpgnf.pdf
Class 12 (November 10, 2015) - Guest Lecturers: To Be Determined
Government Investigations; Self disclosure; Corporate Integrity Agreements/Deferred
Prosecution Agreements.
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Course Materials:



Read Corporate Integrity Agreement – To Be Assigned
Read CMS Voluntary Self-Referral Disclosure Protocol, available at
https://www.cms.gov/PhysicianSelfReferral/Downloads/6409_SRDP_Protocol.pdf
Read OIG’s Provider Self-Disclosure Protocol, available at
http://www.oig.hhs.gov/authorities/docs/selfdisclosure.pdf
Assignment: Turn in FCA fact patterns assignment. Discuss exam format and expectations.
Class 13 (November 17, 2015) – Stark and AKS review; hypos.
Class 14 (November 24, 2015) – Review FCA assignment. FCA and CMPL review; hypos.
Other questions.
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