Yes: 18 U.S.C. § 1347 is the federal health care fraud statute, and it makes it a crime to knowingly and willfully execute, or attempt to execute, a scheme to defraud a health care benefit program or obtain money or property under that program’s control. A conviction carries up to 10 years in federal prison, with enhanced sentences when the fraud causes serious bodily injury or death. Criminal exposure under Section 1347 rarely travels alone. The same conduct frequently triggers civil liability under the False Claims Act, administrative penalties, and exclusion from federal health programs by HHS-OIG.
Federal prosecutors at the Department of Justice, working alongside HHS-OIG and CMS, treat Section 1347 as the backbone charge in most federal health care fraud indictments. Understanding what it actually prohibits, and where it connects to the False Claims Act, Anti-Kickback Statute, and Stark law, matters whether you’re a compliance officer building a defensible program or someone who just received a subpoena.
Key points at a glance:
- 18 U.S.C. § 1347 prohibits knowingly and willfully defrauding a health care benefit program or its money and property.
- Maximum penalty is 10 years imprisonment, rising to 20 years or life if the scheme causes serious bodily injury or death.
- DOJ, HHS-OIG, and CMS coordinate criminal, civil, and administrative enforcement, often simultaneously.
Key Takeaways
The federal health care fraud statute, 18 U.S.C. § 1347, criminalizes knowing and willful schemes against health care benefit programs and carries penalties that scale sharply with harm and intent.
| Point | Details |
|---|---|
| Statute exists and is specific | 18 U.S.C. § 1347 criminalizes knowing schemes to defraud health care benefit programs. |
| Penalties scale with harm | Up to 10 years imprisonment, rising to 20 years or life for serious injury or death. |
| Related statutes multiply exposure | FCA, Anti-Kickback Statute, Stark law, and CMPL often apply to the same conduct. |
| Multiple agencies investigate together | DOJ, HHS-OIG, and CMS frequently coordinate civil and criminal proceedings. |
| Early counsel shapes outcomes | Preserving records and engaging counsel immediately reduces long-term exposure. |
This article is general information, not a substitute for advice from a qualified lawyer. Consult a qualified legal professional about your own circumstances before acting on anything here.
Table of Contents
- What Does the Health Care Fraud Statute Actually Say?
- How Prosecutors Prove Health Care Fraud
- What Penalties Follow a Health Care Fraud Conviction?
- How the False Claims Act, Anti-Kickback Statute, and Stark Law Overlap
- Who Investigates Health Care Fraud, and What Tools Do They Use?
- How Long Do Prosecutors Have, and What Defenses Work?
- What Should You Do If You’re Under Investigation?
- Why Early Counsel Changes the Outcome in Fraud Investigations
- Sources
- FAQ
What Does the Health Care Fraud Statute Actually Say?
Section 1347(a) criminalizes knowingly and willfully executing, or attempting to execute, a scheme to defraud any health care benefit program, or to obtain by false or fraudulent pretenses money or property owned by or under the custody of a health care benefit program. That covers Medicare, Medicaid, TRICARE, and most private insurance plans, since the statute defines “health care benefit program” broadly enough to reach nearly any entity that pays for medical benefits, items, or services.
Subsection (b) contains a detail that trips up a lot of people reading the statute for the first time: prosecutors don’t need to prove you knew the specific federal law you were violating, or that you intended to violate this particular statute. The House-published U.S. Code confirms this, which means “I didn’t know that billing practice was illegal” is a weaker defense than most defendants expect.
- “Knowingly and willfully” requires intent to deceive, not just a mistake.
- Good-faith billing errors, standing alone, typically fall short of the statute’s intent requirement.
- The statute reaches attempts, not just completed schemes.
Pro Tip: A single coding error rarely becomes a federal case. Prosecutors look for patterns across dozens or hundreds of claims, which is why billing audit trails matter more than any individual transaction.
How Prosecutors Prove Health Care Fraud
Federal prosecutors build health care fraud cases around a handful of recurring elements, and knowing them helps you understand where the real exposure sits.
- A scheme to defraud exists, meaning a plan or pattern to deceive, not an isolated slip.
- Materiality attaches to the misrepresentation, meaning it was capable of influencing a payment decision.
- Connection to a health care benefit program ties the conduct to Medicare, Medicaid, or a similar program.
- Intent was knowing and willful, not accidental or negligent.
- Causation links the false claim to an actual or attempted payment.
Common fact patterns include upcoding (billing for a more expensive service than was rendered), phantom billing (charging for services never performed), billing for medically unnecessary procedures, and claims tainted by illegal kickbacks. What separates these from an honest bookkeeping mistake is materiality and repetition. One coding error corrected on internal audit looks nothing like a six-month pattern of billing for services a physician never ordered.
What Penalties Follow a Health Care Fraud Conviction?
A Section 1347 conviction exposes a defendant to up to 10 years in federal prison. That maximum jumps to 20 years if the scheme results in serious bodily injury, and a life sentence becomes possible if it results in death. Courts also impose substantial fines, and federal sentencing guidelines weigh the dollar amount of the fraud, the number of victims, and the defendant’s role heavily.
Criminal exposure is often the smaller half of the problem. The CMS fact sheet on health care fraud laws notes that the same billing conduct frequently triggers civil liability under the False Claims Act, which allows treble damages plus penalties calculated per false claim submitted, not per case.
- Criminal fines and restitution to the defrauded program.
- FCA civil penalties calculated per claim, multiplied across the life of a scheme.
- HHS-OIG exclusion from Medicare and Medicaid, which can end a provider’s ability to bill federal programs entirely.
How the False Claims Act, Anti-Kickback Statute, and Stark Law Overlap
HHS-OIG identifies five federal fraud and abuse laws that most often intersect with criminal health care fraud charges: the False Claims Act, the Anti-Kickback Statute, the Physician Self-Referral Law (Stark), the Exclusion Statute, and the Civil Monetary Penalties Law. Each covers different conduct, but they’re built to work together.
The False Claims Act (31 U.S.C. §§ 3729–3733) imposes civil liability for knowingly submitting false claims to the government, with no requirement to prove criminal intent. The Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)) criminalizes paying or receiving anything of value to induce referrals for services paid by federal programs. The Stark law (42 U.S.C. § 1395nn) bars physician self-referrals for designated health services absent a specific exception, and the Civil Monetary Penalties Law (42 U.S.C. § 1320a-7a) gives OIG authority to impose administrative fines short of criminal prosecution.
Here’s how these connect in practice: a physician who accepts kickbacks for referrals violates the Anti-Kickback Statute directly, but every claim submitted for those referred services can also become a false claim under the FCA, and the underlying conduct may separately support a Section 1347 indictment. One arrangement, three statutes, three exposure tracks.
Who Investigates Health Care Fraud, and What Tools Do They Use?
Health care fraud cases typically move through a coordinated set of federal actors, each with a distinct role.
- DOJ brings criminal indictments and coordinates civil FCA cases through U.S. Attorney’s Offices nationwide.
- HHS-OIG investigates fraud within federal health programs and holds exclusion authority over providers.
- CMS administers Medicare and Medicaid and often flags billing anomalies that trigger referrals to DOJ or OIG.
The DOJ Justice Manual describes Authorized Investigative Demands under 18 U.S.C. § 3486 as a specialized tool available in health care fraud investigations. AIDs let the Attorney General or a designee compel production of records without convening a grand jury, giving investigators a faster path to documents than a traditional subpoena. Civil and criminal teams frequently run parallel investigations on the same conduct, using civil investigative demands and grand jury subpoenas side by side, which is exactly why early counsel matters before you decide what to hand over and how.
How Long Do Prosecutors Have, and What Defenses Work?
The general federal statute of limitations for health care fraud offenses is five years from the date of the offense, though certain related charges or continuing schemes can extend that window through tolling doctrines. Civil FCA claims run on a separate clock, often extending well beyond the criminal deadline.
The strongest defenses tend to attack the elements directly: absence of intent, lack of materiality, documented good-faith billing practices, or reliance on a compliance program built around applicable safe harbors. Criminal cases require proof beyond a reasonable doubt, while civil FCA claims only require a preponderance of the evidence, a gap that shapes strategy from day one.
- Good-faith reliance on coding guidance or legal advice can undercut willfulness.
- Isolated, corrected errors rarely meet the materiality threshold prosecutors need.
- Civil resolution may be more likely than criminal charges when intent evidence is thin.
Pro Tip: Never assume a civil FCA settlement forecloses criminal exposure, or vice versa. Treat every government inquiry as a potential parallel proceeding until counsel confirms otherwise.
What Should You Do If You’re Under Investigation?
- Preserve records immediately, including billing metadata, emails, and audit logs; deleting anything after notice of an investigation compounds exposure dramatically.
- Retain experienced counsel before responding to any subpoena, AID, or informal request for documents.
- Limit internal access to sensitive records and stop any billing practice under scrutiny while counsel evaluates it.
- Coordinate compliance, forensics, and outside auditors through counsel so findings stay protected by privilege where possible.
- Weigh voluntary self-disclosure against negotiated resolution; early, cooperative engagement with DOJ or OIG sometimes reduces penalties, but only when handled through counsel who can control the narrative and the pace.
Pro Tip: The first 72 hours after receiving a subpoena or AID set the tone for the entire investigation. Rushed, uncounseled responses hand prosecutors ammunition you can’t take back.
Why Early Counsel Changes the Outcome in Fraud Investigations
Cases that end badly for defendants share a pattern: fragmented documentation, delayed legal engagement, and internal responses that scatter privilege before anyone thinks to protect it. Cases that resolve more favorably almost always involve counsel brought in early enough to run a forensic review before regulators finish theirs, and a compliance history that shows genuine effort rather than a scramble after the fact.
Remediation matters more to prosecutors than most defendants assume. A provider who can show a functioning compliance program, prompt internal audits, and voluntary correction of billing errors is negotiating from a fundamentally different position than one who discovers a problem only after a subpoena arrives. Murphy’s Law Crypto’s compliance and regulatory defense work centers on this exact principle: coordinating regulatory inquiry responses and forensic reviews before government findings harden into charges, not after. If you’re facing an inquiry or want a compliance program built to withstand scrutiny, Murphy’s Law Crypto’s services cover both the defense and the prevention side of this work.
Sources
- 18 U.S. Code § 1347 – Health care fraud | LII / Legal Information Institute
- Fraud & Abuse Laws | Office of Inspector General – HHS-OIG
- 9-44.000 – Health Care Fraud | Justice Manual
- Laws Against Health Care Fraud Fact Sheet | CMS
FAQ
What qualifies as health care fraud?
Health care fraud includes knowingly billing for services never rendered, upcoding to more expensive procedure codes, billing for medically unnecessary care, and claims tied to illegal kickbacks, all of which can violate 18 U.S.C. § 1347 and the False Claims Act simultaneously.
What is the statute of limitations for health care fraud?
The general federal statute of limitations for health care fraud prosecutions is five years from the date of the offense, though continuing schemes and certain tolling rules can extend that period.
Is there a US federal healthcare fraud statute?
Yes, 18 U.S.C. § 1347 is the federal health care fraud statute, and it applies alongside civil laws like the False Claims Act whenever a scheme touches a federal health program.
What are the penalties for health care fraud?
Criminal penalties under Section 1347 reach up to 10 years in prison, rising to 20 years for serious bodily injury and up to life imprisonment if the fraud causes death, with civil FCA treble damages and OIG exclusion often layered on top.