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Fischer v. United States

Supreme Court of the United States

February 22, 2000, Argued ; May 15, 2000, Decided

No. 99-116

Opinion

 [*669]  [**1782]  [***711]    JUSTICE KENNEDY delivered the opinion of the Court.

 ] The federal bribery statute prohibits defrauding organizations which "receiv[e], in any one year period, benefits in excess of $ 10,000 under a Federal program." 18 U.S.C. § 666(b). We granted certiorari to determine whether the statute covers fraud perpetrated on organizations participating in the Medicare program. Upon consideration of the role and regulated status of hospitals as health [****7]  care providers under the Medicare program, we hold they receive "benefits" within the meaning of the statute. We affirm petitioner's convictions.

Petitioner Jeffrey Allan Fischer was president and partial owner of Quality Medical Consultants, Inc. (QMC), a corporation  [*670]  which performed billing audits for health care organizations. In 1993 petitioner, on QMC's behalf, negotiated a $ 1.2 million loan from West Volusia Hospital Authority (WVHA), a municipal [***712]  agency responsible for operating two hospitals located in West Volusia County, Florida. Both hospitals participate in the Medicare program, and in 1993 WVHA received between $ 10 and $ 15 million in Medicare funds.

 [**1783]  A February 1994 audit of WVHA's financial affairs raised questions about the QMC loan. An investigation revealed QMC used the loan proceeds to repay creditors and to raise the salaries of its five owner-employees, including petitioner. It was determined that petitioner had arranged for QMC to advance at least $ 100,000 to a private company owned by an individual who had assisted QMC in securing a letter of credit in connection with the WVHA loan. QMC, at petitioner's directive, also committed portions of the loan proceeds [****8]  to speculative securities. These investments yielded losses of almost $ 400,000. The investigation further uncovered use of the loan proceeds to pay, through an intermediate transfer, a $ 10,000 kickback to WVHA's chief financial officer, the individual with whom petitioner had negotiated the loan in the first instance. QMC defaulted on its obligation to WVHA and filed for bankruptcy.

In 1996 petitioner was indicted by a federal grand jury on 13 counts, including charges of defrauding an organization which receives benefits under a federal assistance program, 18 U.S.C. § 666(a)(1)(A), and of paying a kickback to one of its agents, § 666(a)(2). A jury convicted petitioner on all counts charged, and the District Court sentenced him to 65 months' imprisonment and a 3-year term of supervised release. Petitioner, in addition, was ordered to pay $ 1.2 million in restitution.

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529 U.S. 667 *; 120 S. Ct. 1780 **; 146 L. Ed. 2d 707 ***; 2000 U.S. LEXIS 3136 ****; 68 U.S.L.W. 4370; 2000 Cal. Daily Op. Service 3769; 2000 Daily Journal DAR 5035; 2000 Colo. J. C.A.R. 2638; 13 Fla. L. Weekly Fed. S 315

JEFFREY ALLAN FISCHER v. UNITED STATES

Prior History:  [****1]  ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT.

Disposition: 168 F.3d 1273, affirmed.

CORE TERMS

Medicare, benefits, reimbursement, costs, providers, patients, funds, federal assistance, healthcare provider, organizations, participating, regulations, Food, federal program, healthcare, provisions, receives, disabled, programs, elderly, Stamp, qualifying, reasonable cost, purposes, bribery, federal funds, medical care, usual course of business, patient care, contractor

Contracts Law, Statute of Frauds, General Overview, Criminal Law & Procedure, Criminal Offenses, Miscellaneous Offenses, Public Health & Welfare Law, Providers, Types of Providers, Hospitals, Bribery, Public Officials, Elements, Fraud, Fraud Against the Government, Social Security, Medicare, Coverage, Healthcare Law, Health Insurance, Reimbursement, Fiscal Intermediaries