Todd Farha & Wellcare- US v. Clay
United States v. Clay is a 2013 case that demonstrates the troubling effects of overcriminalization. The case revolves around WellCare, a health care company that provided behavioral health services to Medicaid patients in Florida. At the time, the state had what was known as the 80/20 rule, which said that behavioral health providers could only charge 20 percent of what they bill to the state as administrative costs. The remaining 80 percent must be paid to the provider. However, the 80/20 rule failed to include language that defined “provider.”
Like many other healthcare providers in Florida, WellCare established a subsidiary that delivered services to patients. As per the 80/20 rule, WellCare reported payments to its subsidiary, a practice that was common among providers with similar setups. It was never disputed that these payments were at market rates, nor were there any claims that Harmony provide substandard care.
In 2007, WellCare fell under the scrutiny of the FBI for allegedly overstating the amount spent on behavioral health services for Medicaid patients. Over 200 FBI agents raided the company’s office, after which a federal grand jury passed down healthcare fraud indictments to four of the organization’s executives. These indictments cited the formation of the subsidiary, as well as statements the executives made about their interpretation of the 80/20 statute and how they should receive payment for the treatment their subsidiary provided.
However, the WellCare executives argued that they had interpreted Florida’s ambiguous 80/20 law in a way that was reasonable, even seeking counsel before establishing the subsidiary. Even government officials testified that their interpretation of the law was reasonable. Moreover, the case United States v. Whiteside set a precedent that a statement is not considered false if it is made based on an “objectively reasonable interpretation” of a law. This precedent was not properly applied in United States v. Clay.
The case against WellCare grew murkier when the district court essentially asked the jury to interpret the complexities of the vague 80/20 rule—when typically, judges decide answers to legal questions and juries decide answers to factual questions. In the end, the WellCare executives were convicted of health care fraud and related offenses. In 2016, their convictions were affirmed by the Eleventh Circuit Court of Appeals.
This case demonstrates the troubling ramifications of overcriminalization by highlighting the government’s ability to punish people for their interpretations of complex, vague laws—even when their interpretations of these laws are reasonable and there is no malicious intent.
For more information on this case visit NACDL – link to https://www.nacdl.org/Content/usvclay
US v. Lawrence Lewis
In 2012, Lawrence Lewis, an engineer from Washington D.C., was arrested after unknowingly violating the Clean Water Act while doing his job. While most people know when they commit a crime, there are also countless instances where Americans unknowingly break the law while performing what they assume are normal everyday tasks. Worse still, there have been few attempts to stop this type of over-criminalization through reform.
At the time of his unwitting violation of the Clean Water Act, Lewis was working at a military retirement home, where he had to handle its backed-up sewage system. When Lewis was first hired at the home, he had been taught to divert the backed-up sewage system to a nearby storm drain, which was thought to empty into the city’s sewer system. Lewis and his staff were misinformed. In fact, the diverted waste ended up in a creek that flowed into the Potomac River, violating the Clean Water Act.
Lawrence Lewis, who had worked hard to escape life in the inner city, wound up facing jail time for performing an everyday task. As Lewis put it: “I couldn’t believe that I was born and raised in the projects and I worked so hard to get out that situation and build a professional career and here I am at work getting arrested for something I had no idea was wrong.” It is a sad reality that Lewis and countless other Americans continue to suffer as a result of overcriminalization. The criminal-justice system should be used to protect the lives, liberty, and property of all Americans and punish truly dangerous offenders, who commit crimes that deserve punishment. The system should not be used to make good, upstanding citizens look and feel like criminals.
For more information on other cases like this visit the NACDL https://www.nacdl.org/Content/TheFaceofOvercriminalization
Robertson v. United States
Joseph Robertson dug ditches to collect water from a rivulet that ran through his private property. In the process some dirt got into the rivulet, which emptied into a local stream, which emptied into a state river, which entered a river that crossed state lines. The Army Corps of Engineers charged Robertson under the Clean Water Act (CWA) with criminal sanctions for failing to get a permit for the “dumping” of “dredge and fill” into interstate waters.
The Constitution’s Commerce Clause gives Congress the power to regulate interstate commerce, including channels of interstate commerce. Those channels include traditional interstate waterways, but the government argues it also includes all waters that may have a “significant nexus” to navigable waters, even those waters that only tangentially intercept actually navigable water. Mr. Robertson lost in the lower courts and he has petitioned the Supreme Court for review. He’s asking the Court to recognize that his ponds are neither remotely navigable nor interstate and to confine the government’s power to the text of the law and strictures of the Constitution. Cato has filed a brief in support of Mr. Robertson’s petition.
We argue that the government reads the definition of the term “waters of the United States” contrary to the Court’s prior decision in Rapanos v. United States. The plurality in Rapanos established that the “waters of the United States” may include non‐navigable wetlands only where the channel at issue is adjacent to a water of the United States, and if the wetland has a continuous surface connection with that water, “making it difficult to determine where the ‘water’ ends and the ‘wetland’ begins.” That line‐drawing problem is not present here. Several clearly identifiable waters separate Robertson’s ponds from the nearest navigable water. Under the plurality definition of “waters of the United States,” Robertson’s would be safe. However, the Rapanos Court didn’t have enough votes to solidify this plain reading of the law. The Court should finally affirm the plurality’s definition of “waters of the United States” because it better protects state and federal jurisdiction over their respective waters, gives clearer definition to “waters of the United States,” places the burden of proof on government for restricting private water use, and will resolve the current circuit split in favor of accountable legislative deliberation about the scope of the commerce power.
Originally published at Cato.org