[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3093 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 3093

  To amend title 18, United States Code, with respect to health care 
                     fraud, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 21, 1993

    Mr. Schumer (for himself and Mr. Sensenbrenner) introduced the 
  following bill; which was referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
  To amend title 18, United States Code, with respect to health care 
                     fraud, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Health Care Fraud Prosecution Act of 
1993''.

SEC. 2. INCREASED PENALTIES FOR HEALTH CARE FRAUD.

    (a) Offense.--Part I of title 18, United States Code, is amended by 
inserting after chapter 50A the following:

                    ``CHAPTER 50B--HEALTH CARE FRAUD

``Sec.
``1101. Health care fraud.
``1102. Illegal remunerations.
``1103. Civil Action.
``1104. Definitions.
``Sec. 1101. Health care fraud
    ``(a) In General.--Whoever, in or affecting interstate commerce, 
knowingly--
            ``(1) executes, or attempts to execute, a scheme or 
        artifice to defraud to obtain a health care payment; or
            ``(2) presents to any person any statement as part of, or 
        in support of, a claim for a health care payment, knowing that 
        such statement contains any false or misleading information 
        concerning any fact or thing material to such claim;
shall be fined under this title or imprisoned not more than 10 years, 
or both.
    ``(b) Aggravated Offenses.--In an offense under subsection (a) of 
this section--
                    ``(1) if the offender knowingly or recklessly 
                causes serious bodily injury to an individual or 
                knowingly or recklessly endangers the life of a person, 
                the offender shall be fined under this title or 
                imprisoned not more than 15 years, or both; and
                    ``(2) if the offender knowingly or recklessly 
                causes the death of an individual, the offender shall 
                be fined under this title or imprisoned not more than 
                25 years, or both.
``Sec. 1102. Illegal remunerations
    ``Whoever, in or affecting interstate commerce, knowingly solicits, 
receives, offers, or provides anything of value--
            ``(1) for the referral of an individual to a person for the 
        furnishing of any item or service for which a health care 
        payment may be paid by a third party payer;
            ``(2) for recommending, or arranging for, the furnishing of 
        any item or service for which a health care payment may be paid 
        by a third party payer; or
            ``(3) which in effect reduces the cost of an item or 
        service for which a health care payment may be paid by a third 
        party payer, and then seeks that health care payment from the 
        third party payer;
without informing the third party payer fully about having done so and 
reflecting the amount of the thing of value in the claim for the health 
care payment, shall be fined under this title or imprisoned not more 
than 5 years, or both.
``Sec. 1103. Civil action
    ``Any person injured in business or property by a violation of this 
chapter may in a civil action recover treble damages. The court may 
award the prevailing party a reasonable attorney's fee as a part of the 
costs.
``Sec. 1104. Definitions
    ``As used in this chapter--
            ``(1) the term `health care payment' means a payment for 
        health care services or health care products, or the right to 
        have a payment made by a third party payer for specified health 
        care services or products; and
            ``(2) the term `third party payer' means any person, public 
        or private, who undertakes to indemnify another against loss 
        arising from a contingent or unknown event.''.
    (b) Clerical Amendment.--The table of chapters at the beginning of 
part I of title 18, United States Code, is amended by inserting after 
the item relating to chapter 50A the following new item:

``50B. Health care fraud....................................   1101.''.

SEC. 3. INJUNCTIONS FOR HEALTH CARE FRAUD.

    Section 1345(a) of title 18, United States Code, is amended--
            (1) in paragraph (1)(A), by striking ``or 1001'' and 
        inserting ``1001, 1101, or 1102''; and
            (2) in paragraph (a)(2), by inserting ``a violation of 
        section 1101 or 1102 of this title or'' after ``as a result 
        of''.

SEC. 4. CRIMINAL FORFEITURE OF FRAUD PROCEEDS.

    Section 982(a)(2)(B) of title 18, United States Code, is amended--
            (1) by inserting ``1101, 1102,'' after ``844,''; and
            (2) by striking ``or 1030'' and inserting ``1030, or 
        1347''.

SEC. 5. REWARDS FOR INFORMATION LEADING TO PROSECUTION AND CONVICTION.

    Section 3059 of title 18, United States Code, is amended by adding 
at the end the following:
    ``(c)(1) The Attorney General may pay a reward of--
            ``(A) an amount determined under paragraph (2) of this 
        subsection, in the case of an offense in which the United 
        States is a victim and restitution or a civil recovery is 
        obtained by the United States; or
            ``(B) not more than $100,000, in any other case;
to any person who furnishes information or services that lead to a 
conviction under section 1101 or 1102 of this title.
    ``(2) The amount referred to in paragraph (1)(A) of this subsection 
is an amount equal to--
            ``(A) not more than 30 percent of the first $1,000,000 of 
        the recovery;
            ``(B) not more than 20 percent of the next $4,000,000; and
            ``(C) not more than 5 percent of the remaining portion of 
        the recovery.
    ``(3) An officer or employee of the United States or of a State or 
local government who furnishes information or renders services in the 
performance of official duty is ineligible for a payment under this 
subsection with respect to such information or services.''.

SEC. 6. HEALTH CARE FRAUD TASK FORCES.

    (a) In General.--The Attorney General, in consultation with the 
Secretary of Health and Human Services, shall establish regional health 
care fraud task forces (hereinafter in this section referred to as 
``task forces'').
    (b) Purpose.--The purpose of the task forces is to ensure that 
adequate resources are made available to identify, investigate, and 
prosecute health care fraud and to recover the proceeds of such fraud 
and other criminal activity against health insurers.
    (c) Duties.--Each such task force shall coordinate the 
investigative and prosecutorial efforts within their region, as 
determined by the Attorney General.
    (d) Participants.--The Federal agencies that shall participate in 
the task forces are--
            (1) the Department of Justice (including the Federal Bureau 
        of Investigation);
            (2) the Department of Health and Human Services (including 
        the Food and Drug Administration and the Office of the 
        Inspector General);
            (3) the Internal Revenue Service;
            (4) the United States Postal Inspection Service; and
            (5) the Veteran's Administration.
    (e) Locations.--The task forces shall be established in such cities 
as the Attorney General deems appropriate.
    (f) Objectives.--The objective of each task force shall be--
            (1) to target, investigate and prosecute individuals who 
        organize, direct, finance, or are otherwise engaged in health 
        care fraud;
            (2) to promote a coordinated health care fraud enforcement 
        effort in each task force region, and to encourage maximum 
        cooperation among all Federal agencies;
            (3) to work fully and effectively with State and local law 
        enforcement agencies; and
            (4) to make full use of financial investigative techniques, 
        on behalf of both public and private entities, to maximize 
        recovery of proceeds of unlawful activities from persons who 
        have committed health care fraud crimes or have engaged in 
        other criminal activity in or against the health insurance 
        industry.
    (g) Standards for Task Force Cases.--Each task force should focus 
upon significant investigations of major health care fraud cases, or 
organizations engaging in health care fraud, that warrant the 
involvement of more than one investigative agency or that require 
significant resources during the investigative stage.
    (h) Administration.--The administrative functions of the national 
task force program will be performed by an executive office to be 
established within the Department of Justice in Washington, D.C. It 
shall be supervised by a Director, and the staff shall consist of 
professional and support staff deemed necessary for the performance of 
management and administrative functions.
    (i) Oversight.--An Executive Review Board shall oversee the task 
force program. It shall be composed of ranking officials from each of 
the participating Federal agencies and the Advisory Committee of the 
United States Attorneys. Its role shall be to articulate policy, review 
allocation of resources and coordinate the development and maintenance 
of the task force program. The Board shall also be responsible for 
resolving policy disputes that cannot be resolved within or among the 
regional task forces or the participating agencies. The Board shall 
meet no less frequently than quarterly.
    (j) Guidelines.--The Attorney General shall, in consultation with 
the Executive Review Board, establish guidelines for the operation and 
management of the task force program.

SEC. 7. NATIONAL HEALTH CARE FRAUD AND ABUSE DATA BASE.

    (a) In General.--The Attorney General, in consultation with the 
Secretary of Health and Human Services, shall establish a data base for 
the reporting of final adverse actions against health care providers, 
suppliers, or practitioners, in order to provide a central repository 
of such information to assist in the prevention, detection, and 
prosecution of health care fraud and abuse.
    (b) Reporting of Information.--
            (1) In general.--Each government agency and health care 
        plan shall report any final adverse action taken against a 
        health care provider, supplier, or practitioner.
            (2) Information to be reported.--The information to be 
        reported under paragraph (1) includes the following:
                    (A) The name of any health care provider, supplier, 
                or practitioner who is the subject of a final adverse 
                action.
                    (B) The name (if known) of any health care entity 
                with which a health care provider, supplier, or 
                practitioner is affiliated or associated.
                    (C) The nature of the final adverse action.
                    (D) A description of the acts or omissions and 
                injuries upon which the final adverse action was based, 
                and such other information as required by the Attorney 
                General.
            (3) Confidentiality.--The Attorney General shall establish 
        procedures to assure that the privacy of individuals receiving 
        health care services is appropriately protected.
            (4) Form and manner of reporting.--The information required 
        to be reported under this subsection shall be reported on a 
        monthly basis and in such form and manner as determined by the 
        Attorney General. Such information shall first be required to 
        be reported on a date specified by the Attorney General.
            (5) To whom reported.--The information required to be 
        reported under this subsection shall be reported to the 
        Attorney General or such person or persons designated by the 
        Attorney General.
    (c) Correction of Erroneous Information.--
            (1) Disclosure and correction.--The Attorney General shall 
        provide for a procedure through which a person, to whom 
        information within the data base established under this section 
        pertains, may review that information and obtain the correction 
        of errors pertaining to that person.
            (2) Other corrections.--Each Government agency and health 
        care plan shall report corrections of information already 
        reported about any final adverse action taken against a health 
        care provider, supplier, or practitioner, in such form and 
        manner as required by the Attorney General.
    (d) Access to Reported Information.--
            (1) Availability.--The information in this data base shall 
        be available to the public, Federal and State government 
        agencies, and health care plans pursuant to procedures 
        established by the Attorney General.
            (2) Fees.--The Attorney General may establish reasonable 
        fees for the disclosure of information in this data base.
    (e) Protection From Liability for Reporting.--No person or entity 
shall be held liable in any civil action with respect to any report 
made as required by this section, without knowledge of the falsity of 
the information contained in the report.
    (f) Definitions and Special Rules.--For purposes of this section:
            (1) The term ``final adverse action'' includes the 
        following:
                    (A) Civil judgments in Federal or State court 
                related to the delivery of a health care item or 
                service.
                    (B) Federal or State criminal convictions related 
                to the delivery of a health care item or service.
                    (C) Actions by State or Federal agencies 
                responsible for the licensing and certification of 
                health care providers, suppliers, and licensed health 
                care practitioners, including--
                            (i) formal or official actions, such as 
                        revocation or suspension of a license (and the 
                        length of any such suspension), reprimand, 
                        censure or probation,
                            (ii) any other loss of license of the 
                        provider, supplier, or practitioner, whether by 
                        operation of law, voluntary surrender or 
                        otherwise, or
                            (iii) any other negative action or finding 
                        by such State or Federal agency that is 
                        publicly available information.
                    (D) Exclusion from participation in Federal or 
                State health care programs.
                    (E) Any other actions as required by the Attorney 
                General.
            (2) The terms ``licensed health care practitioner'', 
        ``licensed practitioner'', and ``practitioner'' mean, with 
        respect to a State, an individual who is licensed or otherwise 
        authorized by the State to provide health care services (or any 
        individual who, without authority holds himself or herself out 
        to be so licensed or authorized).
            (3) The term ``health care provider'' means a provider of 
        services as defined in section 1861(u) of the Social Security 
        Act, and any entity, including a health maintenance 
        organization, group medical practice, or any other entity 
        listed by the Secretary in regulation, that provides health 
        care services.
            (4) The term ``supplier'' means a supplier of health care 
        items and services described in sections 1819 (a) and (b), and 
        section 1861 of the Social Security Act.
            (5) The term ``Government agency'' includes--
                    (A) The Department of Justice.
                    (B) The Department of Health and Human Services.
                    (C) Any other Federal agency that either 
                administers or provides payment for the delivery of 
                health care services, including, but not limited to the 
                Department of Defense and the Veterans' Administration.
                    (D) State law enforcement agencies.
                    (E) State Medicaid fraud and abuse units.
                    (F) State or Federal agencies responsible for the 
                licensing and certification of health care providers 
                and licensed health care practitioners.
            (6) The term ``health care plan'' has the meaning given to 
        such term by section 1128(i) of the Social Security Act.
            (7) For purposes of paragraph (2), the existence of a 
        conviction shall be determined under paragraph (4) of section 
        1128(j) of the Social Security Act.

SEC. 8. NATIONAL HEALTH CARE FRAUD AND ABUSE HOTLINE.

    The Attorney General shall--
            (1) establish a national, toll-free health care fraud and 
        abuse hotline to enable all persons, including health care 
        consumers, providers, and insurers, to report (anonymously, if 
        so desired) suspected instances of health care fraud or abuse;
            (2) provide for the appropriate referral of all information 
        that is obtained through the hot line; and
            (3) assure that the public is provided adequate publicity 
        about the existence and capabilities of the hotline.

SEC. 9. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated for fiscal year 1994 for 
the purposes of carrying out this Act and the amendments made by this 
Act--
            (1) $23,000,000 for the Federal Bureau of Investigation to 
        hire, equip, and train no fewer than 225 special agents and 
        support staff to investigate health-care fraud cases;
            (2) $5,000,000 to hire, equip, and train no fewer than 50 
        assistant United States Attorneys and support staff to 
        prosecute health-care fraud cases;
            (3) $6,000,000 to hire, equip, and train no fewer than 50 
        investigators in the Office of Inspector General, Department of 
        Health and Human Services, to be devoted exclusively to health-
        care fraud cases;
            (4) $2,000,000 to establish, operate, and administer health 
        care fraud task forces;
            (5) $2,000,000 to establish, operate, publicize, and 
        administer the national health care fraud and abuse data base; 
        and
            (6) $2,000,000 to establish, operate, publicize, and 
        administer the national health care fraud and abuse hotline.

SEC. 10. SCHEMES AND DEVICES RELATING TO EXPRESS AND OTHER COMMERCIAL 
              CARRIER SERVICES.

    (a) In General.--Chapter 63 of title 18, United States Code, is 
amended by adding at the end the following:
``Sec. 1347. Express company fraud
    ``Whoever engages in any conduct with respect to a private or 
commercial interstate carrier which, were that conduct engaged in with 
respect to the Postal Service, would be a violation of section 1341 or 
1342 of this title, shall be punished as is provided under such section 
for such violation.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 63 of title 18, United States Code, is amended by adding at the 
end the following new item:

``1347. Express company fraud.''.

SEC. 11. LAUNDERING OF MONETARY INSTRUMENTS.-

    Section 1956(c)(7)(D) of title 18, United States Code, is amended--
            (1) by inserting ``section 1101 or 1002 (relating to health 
        care fraud),'' after ``875 (relating to interstate 
        communications),''; and
            (2) by inserting ``section 1347 (relating to express 
        company fraud),'' after ``1203 (relating to hostage taking),''.

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HR 3093 IH----2