Health care fraud can be divided roughly into two broad categories.

You have your smaller private companies and individuals ripping off the government.

And you have your larger public companies — hospital chains, pharmaceutical companies, medical device corporations — ripping off the government.

A couple of years ago, the Justice Department decided it needed a dedicated unit within the Justice Department to focus on the larger public companies.

And so created something called the Corporate Health Care Fraud Strike Force.

Laura Cordova was the prosecutor in charge of that strike force.

Last month, she left the Department and joined Crowell & Moring.

Cordova started at the Justice Department prosecuting Medicare fraud cases around the country.

“The Medicare Fraud Strike Force started around 2007 down in Miami,” Cordova told Corporate Crime Reporter in an interview last week. “The strike force was designed to prosecute health care fraud cases that weren’t being prosecuted by U.S. Attorneys’ offices – either because they didn’t have the resources or they didn’t have the expertise – whatever the reason. It was attorneys from the Fraud Section in DC going into districts around the country and prosecuting health care fraud cases. These tended to be cases that were identified through data analysis where there was an obvious fraud.”

“As the Fraud Section developed more and more expertise, they started taking on more complex cases. Then you had larger cases involving larger organizations, more complex fraud schemes.”

“For example, in 2012, I indicted two cases down in Houston, one involving the president of a hospital and the other involving the owner operators of a mental health clinic. While we started prosecuting power wheelchair fraud cases – those were some of my first cases as a prosecutor – we were able to use that expertise in prosecuting health care fraud in more complex cases. It was a combination of seeing the need and having the expertise to move forward in that space.”

When you say Corporate Health Care Fraud Strike Force – we are talking about big public companies, right?

“Yes.”

The False Claims Act is a big driver in this area. What’s the relationship between the people in the Department who do False Claims Act cases and the Corporate Health Care Fraud Strike Force?

“As the head of the Corporate Health Care Fraud Strike Force, I reviewed every health care related qui tam that was filed in the country. They were automatically forwarded to me. Sometimes the allegations in the whistleblower complaint rose to the level of being a criminal case. In those instances, I would talk to my colleagues in the Civil Division who were working on the case and we would work together. We were each doing our own thing, but there was definitely coordination.”

Did you look at all qui tam cases, or just the ones where the Department chose to intervene?

“I looked at all of them. As soon as they were filed, they were forwarded to the Civil Division and then they were forwarded to me.”

They are filed under seal. You saw them all. How many were you looking at?

“There were hundreds every year. I don’t have an exact number. The Justice Department announced last year that the corporate strike force had more than a dozen investigations opened.”

How long were you head of the Strike Force?

“We started the initiative in 2014. It became official in 2015. For twelve months I was head of the Corporate Strike Force.”

“People at the Department love to use the term strike force, but it gets confusing. There is a general Health Care Fraud Strike Force. That’s about fifty attorneys. Then there is the Corporate Strike Force.”

“In 2015, I became corporate case coordinator. We didn’t have a separate corporate strike force. But I started reviewing all of the qui tam actions. We started opening criminal cases off of the whistleblower complaints — instead of using the old model of waiting for a criminal referral.”

“That happened in December 2014. In 2015, the Assistant Attorney General said yes, let’s do this, let’s make it a Corporate Strike Force. And it became official. I was the Assistant Chief overseeing it. We had a separate box on the work chart. And we had dedicated personnel.”

Who heads it now?

“Sally Malloy.”

In a 2010 hearing, incoming Attorney General Jeff Sessions said that he favors a return to “traditional prosecutions” and that, regardless of the existential threat a criminal case might present to a corporation, it should “be charged and suffer whatever consequences might result.”

“I was taught, if they violated the law, you charge them. If they did not violate the law, you do not charge them,” Sessions said

How big an issue was this at the Justice Department?

“It is something that people in the Justice Department are always talking about and always having robust debates about. Finding the right resolution of a case is often difficult,” Cordova said. “There are so many factors that come into play, particularly in the healthcare industry.”

“Say you have a hospital serving a rural population. Maybe the corporation did commit a crime. And maybe even that’s undisputed. If they take a guilty plea, they are essentially out of business because they are subject to mandatory exclusion by Medicare. It is something that is constantly being discussed and debated within the Justice Department. Prosecutors are constantly trying to reach the right resolution with the company — taking into account all of the factors were are required to take into account and coming up with the right resolution that optimizes justice.”

Is it an explicit policy at the Justice Department that in a case that calls for a corporate guilty plea for health care fraud, you find a defunct unit or nearly defunct unit of the company and let that unit plead guilty?

“It is part of the discussion. That is part of the robust debate — whether it should be allowed, whether it shouldn’t be allowed, under what circumstances.”

What are the big drivers of health care fraud — the big public companies or individuals and smaller companies?

“You may have someone stealing money hand over fist selling power wheelchairs that they just don’t deliver. They may bill Medicare $1 million, get paid $500,000 before they are shut down. You have to prosecute a whole number of those people to get to the same amount of money as a hospital chain that has some kickback arrangement or upcoding arrangement where they are making $50 million a year. If you have a corporation allowing fraud to occur, you can have a very significant fraud very quickly.”

When you walk into the Justice Department, is there a plaque on a door that says — Corporate Health Care Fraud Strike Force?

“No. We had five attorneys dedicated to the Corporate Strike Force, with the goal of increasing it over time. My understanding is that is still the goal — to increase the number of dedicated attorneys. When we created it, the criteria for joining it was — you had to be an experienced prosecutor with trial experience. These weren’t people right out of law school. They had experience as health care fraud prosecutors.”

Is there any similar office within the Justice Department that has a corporate strike force for any other area?

“Not that I’m aware of.”

You had a staff of five. Now, you are on the other side where you have a staff of 40 lawyers. And there are scores of major firms like Crowell & Moring. There is a resource imbalance. What impact does that resource imbalance have on the outcomes of these cases?

“Prosecutors are often stretched thin. Many are working very hard with sometimes limited resources and are truly seeking to reach a just resolution of any case. This provides real opportunities for companies to be proactive, to understand the facts underlying the allegations and to propose a reasonable resolution.”

“This often involves the company hiring credible counsel to conduct an independent internal investigation and then explaining to the Department of Justice why a particular resolution promotes justice in any particular case.”

“By being proactive, the company can position itself to ensure that early on in the investigation, the Department of Justice attorneys become aware of the real, and sometimes insurmountable, challenges that the government will face if it pursues a particular case.”

“That said, in my experience, when a company or individual decides to take a case to trial against the government, the Department of Justice makes the effort a priority and puts in the necessary resources — be it prosecutors, agents, or support staff — on the case. The government does not back down in these situations.”

[For the complete q/a format Interview with Laura Cordova, see 31 Corporate Crime Reporter 8(13), February 20, 2017, print edition only.]