State v. HardenState v. Harden
Anthony C. Vitale; G. Richard Strafer; Mark L. Shumaker; Manto & Kassebaum and Ronald J. Manto; Tony Moss; and Bennett H. Brummer, Public Defender, and Carlos Gonzalez, Assistant Public Defender, for appellees.
Sonnenshein Nath & Rosenthal (Washington, D.C.), Bruce Merlin Fried, Gadi Weinreich, Howard J. Young, Lisa A. Estrada and Jane Hyatt Thorpe, as amicus curiae.
Before COPE, GODERICH and SHEVIN, JJ.
GODERICH, Judge.
The State appeals from an order granting the defendants’ motion to dismiss the information and declaring Florida‘s Medicaid Provider Fraud Statute,
On December 22, 2000, the State filed a nine-count information charging Gabriel Harden and nine other defendants with racketeering, conspiracy to commit racketeering, and Medicaid fraud. Specifically, in Counts 3-9, the State alleged that the defendants violated the “anti-kickback” provision of Florida‘s Medicaid Provider Fraud Statute,
On October 4, 2002, Harden filed a motion to dismiss the information arguing, among other things, that payment of wages by a Medicaid provider to its employees for the “solicitation and transportation” of Medicaid-eligible children “to dental facilities for treatment” was expressly protected by federal Medicaid statutes and regulations, the so-called “safe harbors,” and that the State‘s attempt to criminally prosecute this federally protected activity was unconstitutional under the Supremacy Clause.
On December 12, 2002, the State filed its response arguing that the method of payment used by the providers to pay the drivers was unlawful. The State alleged that the provider would pay the driver $25 to $30 cash for each Medicaid-eligible child the driver could find and bring to the clinic. The State argued that this recruiting or solicitation of patients by Medicaid providers through its paid employees was unlawful under both federal and state law and amounted to kickbacks for patient referrals.
On January 10 and 31, 2003, the trial court heard arguments of counsel, and on February 18, 2003, the trial court granted Harden‘s motion to dismiss stating, in part:
[T]he State‘s attempt herein to prosecute, as a category of unlawful “remuneration” barred by Section 409.920(2)[(e)], the wages paid by Harden‘s
business, Dental Express, Inc., (i.e., an employer) to certain of its employees for the purposes of soliciting and transporting Medicaid-eligible patients to Harden‘s dental facilities is preempted by both an express provision of the federal Medicaid Act, 42 U.S.C. § 1320a-7b(b)(3) , as well as a parallel administrative “safe harbor” provision,42 C.F.R. § 1001.952(i) .
Thus, the trial court applied implied conflict preemption analysis and found that
The State contends that the trial court erred by declaring
Implied conflict preemption occurs when (a) compliance with both federal and state regulations is a physical impossibility, or (b) when a state law is an obstacle to execution and accomplishment of the objectives and purpose of a Congressional enactment. Pharmaceutical Research & Mfrs. of Am. v. Meadows, 304 F.3d 1197, 1206 (11th Cir.2002).
The federal anti-kickback statute,
(b) Illegal remunerations
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(2) whoever knowingly and willfully offers to pay any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind to any person to induce such person—
(A) to refer an individual to a person for the furnishing or arranging for the furnishing of any item or service for which payment may be made in whole or in part under a Federal health care program, ...
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shall be guilty of a felony....
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(3) Paragraphs (1) and (2) shall not apply to—
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(B) any amount paid by an employer to an employee (who has a bona fide employment relationship with such employer) for employment in the provision of covered items or services....
At first glance,
(e) Knowingly solicit, offer, pay, or receive any remuneration, including any kickback, bribe, or rebate, directly or indirectly, overtly or covertly, in cash or in kind, in return for referring an individual to a person for the furnishing or arranging of the furnishing of any item or service for which payment may be made, in whole or in part, under the Medicaid program, or in return for obtaining, purchasing, leasing, ordering, or
However, upon closer examination, there are two significant differences between the federal anti-kickback statute and the Florida anti-kickback statute. First, the federal statute contains several so-called “safe harbor” provisions that exclude certain types of payments from being considered “illegal remuneration.”
Secondly, the federal anti-kickback statute contains a “knowing and willful” mens rea requirement. Under federal law, “in order to establish a `willful’ violation of a statute, `the Government must prove that the defendant acted with knowledge that his conduct was unlawful.‘” Bryan v. United States, 524 U.S. 184, 192, 118 S.Ct. 1939, 141 L.Ed.2d 197 (1998) (citations omitted). In contrast, Florida‘s anti-kickback statute only requires that the defendant act “knowingly.” In turn, “knowingly” is defined as “done by a person who is aware or should be aware of the nature of his or her conduct and that his or her conduct is substantially certain to cause the intended result.”
For these reasons, we conclude that the trial court properly found that there was implied conflict preemption and declared
Accordingly, we affirm.