Medicare – Anti-Kickback Violation

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7^th Circuit Court of Appeals

Case Name: United States of America v. Jenette George

Case No.: 17-1714

Officials: WOOD, Chief Judge, and ROVNER and HAMILTON, Circuit Judges.

Focus: Medicare – Anti-Kickback Violation

The defendant Jenette George was charged along with three co‐defendants in an indictment alleging violations related to a Medicare‐fraud scheme. The indictment alleged a scheme whereby George received payments from Rosner Home Health Care, Inc. (“Rosner”), for each Medicare patient that she referred to it. George was tried on two counts of receiving kickbacks for Medicare referrals on April 12, 2012, and May 17, 2012, in violation of 42 U.S.C. § 1320a‐7b(b)(1)(A) of the Anti‐Kickback Statute, and with conspiracy to offer kickbacks beginning on or about November 2010 to July 2012, in violation of 18 U.S.C. § 371 and 42 U.S.C. § 1320a‐7b(b)(2)(A). Two owners and an employee of Rosner—Ana Tolentino, Frederick Magsino, and Edgardo “Gary” Hernal—were also indicted on charges of conspiracy and pled guilty prior to trial.

George, however, argues that the statute is limited in its application to persons who are the “relevant decisionmakers” or who are at least persons in a similar position as the relevant decisionmaker. She asserts that she did not fall within that definition because the persons she referred had to be certified by a physician before they could be admitted to Rosner, and that she did not attempt to influence the doctors who certified the patients she referred. She relies for that argument on the Fifth Circuit’s decision in United States v. Miles, 360 F.3d 472 (5th Cir. 2004), in which the court held that payments to a marketing firm which distributed advertisement brochures of the home health service provider to physicians did not fall within the statute because they were not payments made to the relevant decisionmaker as a kickback for sending patients to the service provide George also asserts that there was insufficient evidence that she acted knowingly and willfully under the statute, but this claim cannot withstand scrutiny.

George brings a separate challenge as to the government’s questioning of her regarding this book, arguing that the district court erred in allowing the government to question her as to whether she had read certain paragraphs in the book, but that argument is without merit. First, George ad‐ mitted the book into evidence in her direct examination, and testified that in early 2011 after reading the book she developed concerns about how she and Rosner were doing business and sent an email to Hernal expressing her concerns. She acknowledged reading enough of the book to have concerns about the legality of her arrangement with Rosner, but denied reading sections that specifically discussed kickbacks. George’s only other challenge to cross‐examination is her claim that the government improperly sought a legal opinion from her, a layperson, when it questioned her as to her knowledge of the illegality of referral payments. George has no authority for the proposition that a defendant cannot be asked about her own knowledge or state of mind—a question which she is uniquely positioned to answer—and which seeks factual information not a conclusion as to its legal significance.

George’s final contention is that Hernal should have been considered a “missing witness” because he was not called by the government. She argues that the district court erred in failing to accept her proposed missing witness instruction, which would have allowed the court to infer from Hernal’s absence that Hernal would have provided information unfavorable to the government’s case.

Accordingly, even if the missing witness instruction had been appropriate, its omission here would have been harmless error.

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.