In managing the quickly evolving healthcare landscape during this current crisis, healthcare companies should be wary of fraudsters who attempt to divert critical resources. The US Department of Justice (DOJ) and the US Department of Health and Human Services Office of Inspector General (OIG) are alerting the public about fraud schemes related to the coronavirus (COVID-19).
On March 21, US Attorney General William Barr announced the development of a reporting system for coronavirus whistleblowers who witness public health and safety frauds and misuse of funds during the response to the COVID-19 outbreak. The DOJ and OIG provided additional warnings to the public. On March 22, DOJ announced its first enforcement action related to COVID-19 fraud, followed by a public alert regarding fraud schemes sent out by the OIG on March 23.
With the state of play changing on a daily basis, healthcare companies should maintain agile compliance controls, while keeping up with the rapidly changing landscape. The DOJ’s press release provides recommendations for precautionary measures to protect from known and emerging risks related to COVID-19. Taking the following defensive measures will facilitate the protection of scarce resources in the midst of growing uncertainty:
Assess Risk Potential
Healthcare companies responding to the COVID-19 health crisis—and in particular, the increased demands to secure medical equipment, supplies such as personal protective equipment, and COVID tests as quickly as possible—presents increased compliance risks related to the supply chain. Healthcare companies should be sure to conduct independent verification on the identity of any company, charity, or individual that contacts you regarding COVID-19 supplies or tests. This includes at a minimum checking the websites and email addresses of those offering information, products, or services related to COVID-19.
Beware of Liability by Association
Healthcare providers should be wary of relationships where there is a heightened risk of fraud, waste, or abuse. Healthcare providers will need to be vigilant when engaging in any investment opportunities or joint partnerships tied to COVID-19, even if acting in the best interest of patients. Even with a rapidly evolving crisis, appropriate diligence should be conducted before entering into new business relationships, especially those looking to access and use information on your patient populations.
Protect Sensitive Information
With a growing number of healthcare administrators and operators working remotely, healthcare companies should prioritize the security of their electronic infrastructure and data. Scammers may use COVID-19 as an opportunity to initiate phishing attempts and embed malicious links in communications surrounding the pandemic. For example, DOJ explains that scammers often employ addresses that differ only slightly from those belonging to the entities they are impersonating such as “cdc.com” or “cdc.org” instead of “cdc.gov.” This is a prime opportunity to proactively communicate the heightened risk associated with phishing attacks.
Government enforcement agencies are prioritizing the detection, investigation, and prosecution of illegal conduct related to the COVID-19 pandemic. If you suspect fraud schemes related to COVID-19, DOJ requests that such schemes be reported by calling the National Center for Disaster Fraud (NCDF) hotline (+1.866.720.5721) or emailing the NCDF at email@example.com.
In the wake of the current crisis, healthcare companies cannot let their business partner vetting procedures and related compliance controls fall to the wayside. DOJ has emphasized that “one hallmark of an effective compliance program is its capacity to improve and evolve.” US Dep’t of Justice, Criminal Division, Evaluation of Corporate Compliance Programs(Apr. 30, 2019).
During this time, it is important to be aware of the potential consequences for fraud, including the diversion of essential resources, and misuse of sensitive patient information.
Coronavirus COVID-19 Task Force
For our clients, we have formed a multidisciplinary Coronavirus COVID-19 Task Force to help guide you through the broad scope of legal issues brought on by this public health challenge. We also have launched a resource page to help keep you on top of developments as they unfold. If you would like to receive a daily digest of all new updates to the page, please subscribe now to receive our COVID-19 alerts.