By: Matt Fischer
Federal law enforcement has traditionally prosecuted individuals utilizing healthcare fraud and abuse laws such as the Federal Anti-Kickback Statute, the False Claims Act, the Physician Self-Referral Law also known as the Stark Law as well as other administrative tools including exclusions and civil monetary penalties. In addition to these laws, federal law enforcement also has at their disposal other fraudulent act statutes such as mail and wire fraud. The facts of a case, however, may not provide for federal standing. For example, when individuals take out federal government payors out of the picture or from an arrangement as a way of avoiding federal jurisdiction. The new solution to this issue…a law enacted in 1961, the Travel Act.
The Travel Act, 18 U.S.C. § 1952, was enacted in 1961 originally to combat organized crime and racketeering activity for crimes such as illegal gambling, bribery of government officials, prostitution, and the illegal production and distribution of liquor and narcotics. At the start of the Kennedy Administration, the focus of the Justice Department was on organized crime and racketeering. Essentially, this law allows federal prosecutors to bring charges for criminal violations of state law in interstate commerce. In other words, it creates federal jurisdiction when there is criminal activity that violates state law, rather than federal law, and the criminal acts are directed across state lines.
Recently, the Travel Act was used in the prosecution of several Florida individuals. In June 2018, the U.S. Attorney’s Office for the Southern District of Florida announced numerous indictments as a part of a national fraud takedown. In case number 2018-80111 filed in the Southern District of Florida (i.e. United States v. Eric Snyder, et al.), multiple sober home and substance treatment facility owners including patient brokers were charged with not only health care fraud, wire fraud and conspiracy to commit healthcare fraud and money laundering but also for violating the Travel Act. The alleged scheme included illegally recruiting patients, paying kickbacks, and defrauding healthcare benefit programs.
The Travel Act appears to be the newest tool in the ever-growing arsenal available to a federal prosecutor. With expected challenges from defendants in the future arguing its use is inappropriate, many will be watching to see if the Travel Act gains judicial support and signals a new expansion of federal jurisdiction in the fight against healthcare fraud.