104 F. Supp. 3d 317
W.D.N.Y.2015Background
- Defendant Nina Jafari, a licensed clinical social worker, was convicted by a jury on four counts of health-care fraud under 18 U.S.C. § 1347 for billing BlueCross BlueShield of WNY (BCBS) using inflated CPT code 90808 and for billing services not rendered; she was acquitted on one count.
- At sentencing the court imposed 80 months’ imprisonment but deferred restitution because the Government’s restitution figures varied widely and were disclosed less than ten days before sentencing.
- BCBS sought restitution based on claims from January 1, 2006 through April 30, 2009; its methodology downgraded billed 90808 sessions to 90806 (shorter individual sessions) and consolidated family sessions to 90847 where appropriate, producing a requested restitution of $138,842.78.
- The Government’s and PSR’s restitution numbers had shifted substantially during post-trial proceedings; the court ordered supplemental submissions and heard testimony from BCBS’s Special Investigations Manager and an FBI agent.
- The court accepted that the MVRA applied, that restitution may be based on the entire fraudulent scheme (including acquitted/uncharged conduct within the scheme), and that a reasonable approximation of loss is permissible where exact loss is inherently difficult to calculate.
- The court adjusted BCBS’s calculations downward for two families (Ferrucci and Sidoti) after its own review and ordered restitution of $135,742.18.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MVRA applies to these health-care fraud convictions | MVRA applies because health-care fraud is an offense against property by fraud and an identifiable victim (BCBS) suffered pecuniary loss | Implicitly contested scope/amount but did not contest MVRA applicability | MVRA applies to the convictions; restitution is mandatory under §3663A for these offenses |
| Whether restitution may be based on a reasonable estimate when exact loss is uncertain | Government: district court may use a reasonable approximation of loss where exact amount is inherently incalculable; provided methodology and evidence supporting estimate | Jafari argued some 90808 bills might have reflected longer individual sessions (up to an hour) and thus should not all be downgraded; asked for hearing but did not press further submissions | Court held reasonable-estimate standard applies; BCBS methodology (downgrading codes and consolidating family sessions) is reasonable and supported by record; uncertainties resolved for fairness to victim |
| Whether court may include losses from acquitted or uncharged conduct that are part of the same fraudulent scheme | Government: restitution may include losses caused in the course of the overall scheme, not limited to counts of conviction | Defendant argued limits should apply to counts of conviction (invoking Hughey) | Court held court may consider the entire scheme; acquitted count was part of overarching scheme and thus may be considered for restitution |
| Sufficiency and accuracy of BCBS’s specific calculations (Ferrucci & Sidoti discrepancies) | BCBS provided detailed claim review and relied on testimony and exhibits to compute overpayments | Defense challenged fairness of converting all 90808 to 90806 and specific family calculations | Court found methodology reasonable generally but adjusted Ferrucci and Sidoti amounts after independent review; final restitution set at $135,742.18 |
Key Cases Cited
- Hughey v. United States, 495 U.S. 411 (1990) (VWPA restitution originally limited to loss caused by offense of conviction, later altered by amendments and MVRA context)
- United States v. Gushlak, 728 F.3d 184 (2d Cir. 2013) (MVRA requires a reasonable approximation of losses supported by sound methodology)
- United States v. Zangari, 677 F.3d 86 (2d Cir. 2012) (court may not substitute defendant’s gains for victim’s actual loss where actual loss must be used)
- United States v. Reifler, 446 F.3d 65 (2d Cir. 2006) (MVRA requires restitution to compensate victims in full; rough estimates may contravene MVRA if unsupported)
- United States v. Bahel, 662 F.3d 610 (2d Cir. 2011) (district court may use conservative estimates of loss tied to record evidence)
- United States v. Chaika, 695 F.3d 741 (8th Cir. 2012) (restitution in fraud cases limited to actual loss directly caused by the defendant’s conduct)