FISCHER v. UNITED STATES

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Case Basics
Docket No. 
99-116
Petitioner 
Fischer
Respondent 
United States
Advocates
(Department of Justice, argued the cause for the respondent)
(Argued the cause for the petitioner)
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Facts of the Case 

Jeffrey Fischer, while president and part owner of Quality Medical Consultants, Inc. (QMC), arranged for QMC to receive a $1.2 million loan from West Volusia Hospital Authority (WVHA), a municipal agency that operates two hospitals, which participate in and receive funding from the federal Medicare program. To get the loan, Fischer pledged QMC's accounts receivables and offered a $1 million letter of credit. After a 1994 audit of WHVA raised questions about the QMC loan, Fischer was indicted for federal bribery, including defrauding an organization which "receives, in any one year period, benefits in excess of $10,000 under a Federal program." A jury convicted him and the District Court sentenced him to imprisonment, imposed a term of supervised release, and ordered the payment of restitution. On appeal, Fischer argued that the Government failed to prove WHVA, as the organization affected by his wrongdoing, received "benefits in excess of $10,000 under a Federal program," as required by the federal bribery statute. In rejecting that argument and affirming the convictions, the Court of Appeals held that funds received by an organization constitute "benefits" within the statute's meaning if the source of the funds is a federal program, like Medicare, which provides aid or assistance to participating organizations.

Question 

Do Medicare funds received by health care providers constitute "benefits" within the meaning of the federal bribery statute prohibiting fraud and other offenses against organizations receiving federal benefits?

Conclusion 
Decision: 7 votes for United States, 2 vote(s) against
Legal provision: 18 U.S.C. 666

Yes. In a 7-2 opinion delivered by Justice Anthony M. Kennedy, the Court held that "Health care providers such as the one defrauded by [Fischer] receive 'benefits' within the meaning of [the federal bribery statute]." Thus, the Medicare funds hospitals receive for treating Medicare patients subject people who bribe hospital officials to federal prosecution. "The government has a legitimate and significant interest in prohibiting financial fraud or acts of bribery being perpetrated upon Medicare providers," Justice Kennedy wrote for the court. "Fraudulent acts threaten the program's integrity. They raise the risk participating organizations will lack the resources...to provide the level and quality of care envisioned by the program." Justice Clarence Thomas, in a dissenting opinion joined by Justice Antonin Scalia, argued that "[t]he only persons who receive 'benefits' under Medicare are the individual elderly and disabled Medicare patients, not the medical providers who serve them."

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FISCHER v. UNITED STATES. The Oyez Project at IIT Chicago-Kent College of Law. 23 October 2014. <http://www.oyez.org/cases/1990-1999/1999/1999_99_116>.
FISCHER v. UNITED STATES, The Oyez Project at IIT Chicago-Kent College of Law, http://www.oyez.org/cases/1990-1999/1999/1999_99_116 (last visited October 23, 2014).
"FISCHER v. UNITED STATES," The Oyez Project at IIT Chicago-Kent College of Law, accessed October 23, 2014, http://www.oyez.org/cases/1990-1999/1999/1999_99_116.