On April 8, 2021, the U.S. Department of Justice issued a press release regarding a Colorado physician who is accused of stealing nearly $300,000 from three COVID-19 relief programs – the Accelerated and Advance Payment Program (“AAPP”), the Provider Relief Fund (“PRF”), and the Paycheck Protection Program (“PPP”).  The AAPP provides necessary funds when there is a disruption in claims submission and/or claims processing.  CMS generally offers the funds through the AAPP during select national emergencies and natural disasters to accelerate cash flow for affected healthcare providers and suppliers.  The PRF, with billions in allocations, reimburses eligible providers for healthcare-related expenses and lost revenue attributable to COVID-19.  And under the PPP, loans are available to cover salaries and other expenses and are government-backed, low-interest (1%), and forgivable if certain criteria are met. 

According to the press release, the physician allegedly stole approximately $118,000 in COVID-19 related government relief funds from the AAPP and the PRF.  As part of the theft, the physician allegedly transferred the $118,000 from a medical clinic to his bank account.  Some of the money transferred was used on travel and home improvements.  After being terminated from his practice, the provider allegedly applied for a $179,999 loan under the PPP on behalf of his former employer’s practice.  He diverted the PPP funds to his bank account.  Unbeknownst to his former employer, the provider then filed bankruptcy on behalf of the clinic. 

The provider was charged with theft in connection with health care, theft of government property, wire fraud, and making a false statement in a bankruptcy proceeding, according to the press release.  The provider’s charges also mark what could be the second criminal case related to the PRF.  While some may consider the provider’s alleged actions as unusually brazen, such alleged activities are more common than some may assume.  Medical practices and their leadership should implement proper policies, procedures, and systems to reduce the impact that a rogue employee/former employee can inflict upon a medical practice.  Medical practices should also be prepared to respond appropriately, with advice and assistance of counsel, to any government investigation that may arise from nefarious actions by employees/former employees, as the identity of the target and the victim may not be distinguishable or initially clear to government investigators. 

The attorneys at Chilivis Grubman represent healthcare clients of all types and sizes in connection 

with government investigations (both criminal and civil) and regulatory matters, including matters involving the DOJ and HHS-OIG.  If you need assistance with such a matter, please contact us today.