OIG Investigation Process

**Attorney Lynette Byrd**
OIG Investigation Process Team Lead
Contact Lynette

envelope icon — **Attorney Lynette Byrd**
OIG Investigation Process Team Lead
Contact Lynette

**Deborah Zarifian**
OIG Investigation Process Team Consultant
Former FBI Special Agent
Registered Pharmacist (CT)

The U.S. Department of Health and Human Services Office of Inspector General (HHS OIG) shares responsibility for enforcing the Stark Law, Anti-Kickback Statute, False Claims Act, and myriad other federal statutes that apply to healthcare providers. In order to meet its enforcement mandate, the HHS OIG conducts an extraordinary volume of investigations—and these investigations frequently lead to civil or criminal charges.

For healthcare providers that are facing HHS OIG investigations, it is imperative to have a clear understanding of the investigative process. By understanding what to expect, healthcare providers can structure their defense strategies effectively, and they can work proactively to avoid charges. In this article, we provide an overview of the seven major steps in the HHS OIG investigation process, and we also discuss seven steps healthcare providers need to take when facing HHS OIG investigations.

7 Steps in the HHS OIG Investigation Process

An HHS OIG investigation is a structured, organized, and focused process. When conducting a healthcare fraud investigation, HHS OIG agents and lawyers have a clear goal in mind, and they have well-established procedures for achieving this goal as efficiently as possible. If an investigation uncovers evidence of fraud, prosecutors will not hesitate to pursue charges, and the target (or targets) of the investigation will need to be prepared to defend themselves by all means available.

The seven major steps in an HHS OIG healthcare fraud investigation are as follows:

1. Identify a Target

The HHS OIG identifies investigation targets through various means. It relies on both internal and external sources of information; and, in many cases, it works with other state and federal law enforcement agencies that are investigating targets for non-healthcare-related offenses (i.e. tax fraud). Some of the most-common ways that the HHS OIG identifies the targets of its investigations include:

Hotline Complaints – The HHS OIG operates a complaint hotline, and it encourages patients, employees, and others to report instances of suspected fraud, waste, and abuse.
Whistleblower Complaints – The HHS OIG also conducts investigations based on whistleblower complaints submitted through means other than the Office’s complaint hotline.
MAC, RAC, and UPIC Audits – In many cases, the HHS OIG will launch investigations based on information supplied by Medicare Administrative Contractors (MACs), Recovery Audit Contractors (RACs), and Unified Program Integrity Contractors (UPICs).
Information from Other Agencies – As mentioned above, the HHS OIG often works collaboratively with other agencies, including the Centers for Medicare and Medicaid Services (CMS), Drug Enforcement Administration (DEA), Federal Bureau of Investigation (FBI), U.S. Department of Justice (DOJ), and Medicaid Fraud Control Units (MFCUs).
Data Anomalies – The HHS OIG collects an extraordinary amount of data about healthcare providers’ billing practices, and it relies on analytics software to comb through the data and identify possible instances of billing fraud.

2. Identify and Interview Witnesses

After identifying a target, one of the HHS OIG’s next steps is to identify witnesses. These witnesses may include patients, employees, or employees of other practices or companies. For example, if the HHS OIG is investigating allegations that a healthcare provider offered to pay illegal kickbacks, it may seek to interview employees of the company to which the kickbacks were allegedly offered. Or, if a target has been accused of billing Medicare for services that weren’t actually rendered, agents may seek to interview the provider’s patients regarding the care they received.

3. Perform Data Analytics

In addition to using data analytics to identify targets for its investigations, the HHS OIG also uses data analytics to collect evidence during the investigative process. The HHS OIG will examine not only targets’ billing data, but other providers’ and companies’ billing data as well. Comparative analyses will often yield evidence of improper billings, and then the HHS OIG can use this evidence in furtherance of its other investigative efforts.

4. Visit the Target’s Offices

When conducting healthcare fraud investigations, HHS OIG agents will often visit targets’ offices. In many cases, these visits will be unannounced, and agents will not have a subpoena. Rather, they will simply state that they are there for a “routine” inspection, and they will seek to gather as much information as they can through the target’s employees.

5. Issue Subpoenas

In addition to collecting evidence through various informal means, HHS OIG agents will use formal means as well. Specifically, they will use subpoenas to compel targets (and witnesses) to provide testimony, records, or both. HHS OIG subpoenas can seek extraordinary amounts of information; and, while there are grounds for challenging HHS OIG subpoenas in appropriate circumstances, these grounds are limited, and in most cases the federal courts will defer to the HHS OIG’s investigative expertise.

6. Evaluate the Evidence

After gathering evidence from all available sources, the HHS OIG’s agents and lawyers will evaluate the evidence in light of all pertinent federal laws. Does the evidence indicate that the target has violated a federal law such as the Stark Law, Anti-Kickback Statute, or False Claims Act? Does the evidence indicate a possible violation, but is it insufficient to support charges on its own? If necessary, HHS OIG agents will continue gathering evidence subsequent to this evaluation—and they will work with the Office’s lawyers to determine when they have enough evidence to go to court.

7. Determine Whether to Pursue Civil or Criminal Charges

HHS OIG healthcare fraud investigations can lead to either civil or criminal charges. After evaluating the available evidence, the HHS OIG will decide which type of charges to pursue. Most healthcare fraud cases are civil in nature—and possible penalties include recoupments, fines, costs, and program exclusion. However, the HHS OIG does not hesitate to pursue criminal charges when warranted—and in these cases federal imprisonment can also be on the table.

Dr. Nick Oberheiden

Founder

Attorney-at-Law

Lynette S. Byrd

Former DOJ Trial Attorney

Partner

Brian J. Kuester

Former U.S. Attorney

Amanda Marshall

Former U.S. Attorney

Local Counsel

Mike Pompeo

Of Counsel

Former U.S. Secretary of State

John W. Sellers

Former Senior DOJ Trial Attorney

Linda Julin McNamara

Federal Appeals Attorney

Aaron L. Wiley

Former DOJ attorney

Local Counsel

Roger Bach

Former Special Agent (DOJ)

Chris J. Quick

Former Special Agent (FBI & IRS-CI)

Michael S. Koslow

Former Supervisory Special Agent (DOD-OIG)

Ray Yuen

Former Supervisory Special Agent (FBI)

7 Steps for Defending Against an HHS OIG Investigation

Targets of HHS OIG investigations can—and should—defend themselves at each stage of the investigative process. With a proactive approach, targets can avoid both civil and criminal charges in many cases. With this in mind, when facing HHS OIG investigations, healthcare providers and other entities should:

1. Intervene in the HHS OIG’s Investigation

Targets of HHS OIG investigations should not allow the process to move forward unchecked. Rather, they should engage defense counsel to intervene—and they should do so as soon as possible. Intervening slows the process down, it allows the provider’s or company’s lawyers to oversee the process, and it is the first step toward achieving a favorable pre-charge outcome.

2. Conduct an Internal Risk Assessment

In tandem with intervening, targets of HHS OIG investigations must also conduct internal risk assessments. The purposes of these assessments are twofold: (i) to determine whether HHS OIG agents are likely to uncover issues during their investigation; and, (ii) if so, what defenses can be asserted to avoid or mitigate any potential penalties.

3. Advise Internal Personnel Regarding the Investigation

As we mentioned above, HHS OIG agents will often visit targets’ offices during the investigation process. With this in mind, healthcare providers and others need to be prepared. Among other things, this means advising internal personnel regarding the investigation—and making clear that they should not answer any questions or provide any information unless advised to do so by the entity’s defense counsel.

4. Prepare to Receive an HHS OIG Subpoena

Responding to an HHS OIG subpoena is a process in itself, and it can be incredibly time-consuming. As a result, if it appears that service of an HHS OIG subpoena may be imminent, it will generally be advisable to take steps to prepare. The specific steps that are necessary will depend on the specific circumstances involved—from the nature of the allegations to the potential scope of the HHS OIG’s demands.

5. Develop a Targeted Defense Strategy

With a clear understanding of the issues at hand, the next step is to develop a targeted defense strategy. The key word here is “targeted,” as healthcare providers and other entities cannot afford to waste time “defending” against allegations that aren’t on the table. Targets of HHS OIG investigations need to act with a clear strategy in place, and everything they do must take into account the risks and other realities of their present circumstances.

6. Work Toward a Pre-Charge Resolution

In the vast majority of cases, the goal during an HHS OIG investigation should be to obtain a favorable pre-charge resolution. This provides certainty, avoids publicity, and avoids unnecessary costs. Oftentimes this will mean working to resolve the investigation without any liability. However, in appropriate circumstances it may be prudent to target a pre-charge settlement.

7. Prepare for Civil Enforcement Litigation or Grand Jury Proceedings (if Necessary)

Finally, if it is not in a target’s best interests to settle, and if the HHS OIG is unwilling to terminate the investigation without liability, then it will be necessary to prepare for civil enforcement litigation or grand jury proceedings. These are two very different, very high-risk propositions, and targets must work closely with their defense counsel to protect themselves as the process moves forward.

Speak with a Federal Healthcare Fraud Defense Lawyer at Oberheiden P.C.

At Oberheiden P.C., our federal healthcare fraud defense lawyers are highly experienced on both sides of HHS OIG investigations. If you need to speak with a lawyer about an HHS OIG investigation, we encourage you to call 888-680-1745 or contact us online promptly for a complimentary consultation.