(June 1, 2010): Like most honest health care providers, you may believe that search warrants are only executed by the government in connection with the investigation of nefarious characters and criminals. Unfortunately, that just isn’t the case. The Federal government has increasingly utilized search warrants as a first-strike investigative tool. In fact, the execution of a search warrant may very well be the first notice a health care provider has that their practice or clinic is under investigation. Allegations of wrongdoing may arise from a wide variety of sources. Health care providers may have been reported by disgruntled current or former employees, dissatisfied patients, or others familiar with the practice’s operations. Notably, recent criticism aimed at RACs for their failure to identify and refer possible criminal wrongdoing to the government for further investigation may have generated a new period of significant enforcement. It appears that Zone Protection Integrity Contractors (ZPICs) around the country have recently intensified their activities, going well beyond the typical overpayment audits normally seen. We have seen a marked increase in the number of unannounced site visits, Medicare suspension actions and Medicare number revocation cases. We fully anticipate the number of criminal referrals to DOJ to increase as well.
I. Search Warrant Basics:
In assessing this issue, it is important to remember that prior to obtaining a search warrant, an Assistant U.S. Attorney has gone before a Federal Magistrate and has shown “probable cause” that a crime has been committed or is being committed. Once issued, the search warrant may greatly help DOJ build its case. Search warrants are preferable to subpoenas and other investigative tools because:
- The health care provider will likely be caught completely off-guard, thereby reducing the possibility that documents may be lost, destroyed or otherwise be missing before it can be secured as part of the investigation. In executing a search warrant, the government can preserve the documentation and electronic evidence to the greatest extent possible.
- The government may use the execution of a search warrant as an opportunity to segregate possible witnesses and see if they can interview the employees and obtain statements before the practice and its employees have an opportunity to obtain counsel.
- The combination of force and surprise will have an enormous psychological effect on your employees. There will be absolutely no question about the seriousness and gravity of the government’s investigation. This is often very intimidating, often resulting in significant damage to the practice, ranging from employee resignations to adverse publicity and media attention.
- Finally, the scope of the search warrant will likely be sufficiently broad that the practice or clinic will have a difficult time determining the focus of the government’s investigation.
Once a search warrant is executed, the issue becomes how to best respond. The purpose of this advisory is to provide an overview of the Federal search warrant process so that your interests can be protected.
II. Responding to a Federal Search Warrant:
A. Before the search.
If the government were to execute a search warrant on your practice today, would you be ready? Have your employees been briefed on how to respond if Federal agents show up at your practice or clinic? If your answer to either of these questions is “no,” you should take immediate steps to better ensure that you are ready if this event were to occur. Understandably, no health care provider likes to think that they would learn of an investigation in such a fashion. Nevertheless, it occurs practically every day. You should work with your attorney to draft procedures for responding to a search warrant that are tailored for your practice or clinic.
B. At the time of a search.
Please remember that these steps are not all-inclusive. Upon the execution of a Federal search warrant, you should immediately contact your attorney so that the specific facts and circumstances of your situation can be fully assessed and taken into consideration. In responding to a search warrant, you should:
At the outset, it is important that you avoid taking any actions that could be misconstrued by the government as an obstruction to their search. That does not mean that you cannot ask questions – merely that you should not obstruct their search.
Try and ensure that patient care activities are not jeopardized. Typically, law enforcement will be sensitive to these issues and will try to avoid direct patient care areas. Nevertheless, you may need to bring this issue to their attention. You may find that legal counsel can often work with law enforcement to resolve an unreasonable intrusion in this regard.
Ask for a copy of the search warrant and give it to your lawyer. Your lawyer will try and prevent them from seizing any documents or items that appear to be outside of the scope of their warrant. Importantly, search warrants are supposed to provide a specific description of the information or items to be search. If a search warrant is ambiguous overly broad, your counsel may choose to seek to quash to the search.
Regarding the search warrant itself, your lawyer will note the issuance date of the warrant and the date it was executed. Additionally, counsel will ask to check the identification of the leading agent handling the search, along with the identification of any other participating agencies (e.g. IRS, OIG).
While your lawyer may request to see the affidavit upon which the search warrant is based, you should not be surprised if it was sealed by the Court and cannot be obtained. If counsel has not yet arrived, call your lawyer to discuss whether there may be any grounds to object to the search. Should you object, inform the lead agent of your objection. Should the search continue, record the date and time of their arrival and departure.
If they will allow it, accompany agents on the search. Try to note which areas were searched and which documents or items were seized.
You may have documents that qualify as attorney-client privileged materials. Should agents try to take documents that may be considered privileged, you should immediately object and notify the agents that the documents they are seizing are privileged.
Try and obtain a receipt from the agents for any items or documents that are seized. When possible, get copies of original documents before they are removed.
C. Handling employee issues.
The execution of a search warrant is an extremely stressful situation and can create confusion and stress on a practice’s employees. You should quickly move to restore order and re-assure employees that the situation is under control.
While a search warrant can be used to seize documents or other items, it cannot be used to force employees to participate in an interrogation. Due to the many sensitivities in this area, it is strongly recommended that you have counsel advise employees of the situation. While the government cannot force employees to answer questions, you must take care when you are briefing employees on the situation. While you must not tell employees that they are not allowed to talk with an agent, it is appropriate to tell employees that they have no obligation to answer any questions. While individuals have a Fifth Amendment privilege against self-incrimination, your practice or clinic does not enjoy such a privilege.
When possible, send employees home for the day or have them work in another part of the facility. Finally, you should notify employees that any questions regarding the location of certain records should be directed to a specific management official so that any inquiries can be properly and consistently handled.
D. After the search.
Document retention issues should be carefully handled. It is our view that all document destruction should immediately stop, even if the activity would be consistent with pre-search document retention policies used by the practice or clinic. Once an investigation is initiated, you should diligently work to avoid even an appearance that obstruction of justice may be occurring.