OPINION
In this аction brought by the United States (the “Government”) against the defendant pro se Irwin Halper (“Halper”) for the filing of allegedly inflated Medicare claims in violation of the False Claims Act, 31 U.S.C. §§ 3729-3731, the Government has moved for summary judgment. Because Halper is collaterally estopped from denying the facts which entitle thе Government to judgment in its favor, the motion for summary judgment is granted.
The following findings and conclusions are made on the affidavit, memorandum of law, and exhibits submitted by the Gоvernment, and the letter in opposition from Halper dated January 10, 1987.
The Facts
At all times relevant to the complaint, Halper was manager of New City Medical Laboratories, Inc. (“NCML”), a corporation providing medical services to patients eligible for Medicare. Since January, 1982, providers оf Medicare services have been instructed to use certain billing procedure codes on claims filed with Blue Cross and Blue Shield of Greater New York (“Blue Cross”), the fiscal intermediary of the United States Department of Health and Human Services. Blue Cross made available to each provider mаnuals listing the Medicare procedure code corresponding to each type of medical service and the cost Medicare would pay to providers for that service.
In addition to the procedure codes corresponding to each particular medical serviсe, the manual specified two procedure codes to be included on Medicare claim forms for additional reimbursement to providers who had to travel to a private home, a nursing home or a Skilled Nursing Facility to perform a medical service. The “9018” procedure code was the proper code for seeking reimbursement for services performed on the first or only patient seen at such a facility. The “9019” procedure code was the proper code for seeking reimbursement for services performed on each subsequent patient seen on the same day at the same facility. According to the manuals, at all relevant times, the reimbursement allowed by Medicare for services billed under the “9018” code was either $10.00 or $12.00, and the reimbursement allowed by Medicare for services billed under the “9019” code was $3.00.
From in or about January, 1982 until in or about December, 1983, Halper submitted 65 claim forms that falsely characterized certain services performed by NCML as services reimbursable under the higher-priced “9018” procedure code rather than the “9019” code, even though they were performed not on the first or only patient but on subsequent patients at a particular facility on a particular day. Blue Cross, unaware of the foregoing circumstances, made payment on the Medicare claims at the highеr “9018” rate when the claims should have been paid at the lower “9019” rate.
On July 9, 1985, Halper was convicted of 65 counts of submitting false claims in violation of 18 U.S.C. §§ 2 and 287, based on the same acts alleged in the complaint in the present action. He was sentenced to two years and a fine of $5,000.
Collateral Estoppel
The False Claims Act is violated by anyone not a member of the armed services of the United States who “knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved.” 31 U.S.C. § 3729(a)(2). The fact that Halper submitted false claims to Blue Cross, the Government’s fiscal intermediary, rather than directly to the Government, is of no significance.
See United States ex rel. Marcus v. Hess,
In this civil case, the Government can rely on the criminal conviction obtained against Halper to establish issues which were necessarily determined by the judgment of conviction.
United States v. Greenberg,
Damages and Forfeiture
Title 31 U.S.C. § 3729 provides that a person who knowingly makes a false statement to gеt a false claim approved “is liable to the United States Government for a civil penalty of $2,000, an amount equal to two times the amount of damаges the Government sustains because of the act of that person, and the costs of the civil action....”
The Supreme Court has held that a provisiоn for a civil penalty of $2,000 plus twice the Government’s damages is not in itself a criminal penalty giving rise to a claim of double jeopardy; reasoning thаt the purpose of such a provision is to ensure that the Government is fully compensated for any damages it has incurred.
See United States ex rel. Marcus v. Hess,
Were this court to grant the relief the Government seeks, the statute as applied would violate the Double Jeopardy Clause. The Government seeks to recover $130,000, representing the $2,000 allotted by statute for each of the 65 false claims set forth in the complaint. At most, however, the amount by which the 65 claims were inflated was $9.00 for eaсh claim, or $585. Even adding to that amount the Government’s expense in investigating and prosecuting this action, the total amount necessary to make the Government whole bears no rational relation to the $130,000 penalty the Government seeks.
See Peterson v. Richardson,
Although the Government has not briefed the issue, the imposition of a civil penalty of $2,000 for each false claim does not appear to be mandatory under the statute.
See United States v. Greenberg,
Therefore, summary judgment in the amount of $16,000 is granted in the Government’s favor.
IT IS SO ORDERED.