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Sufficiency of Evidence Under The New Health Care Fraud Statute Penal Law Article 177

People v. Khan  2012 NY Slip Op 00855

Decided February 9, 2012 New York Court of Appeals.  

Issue: Whether there was legally sufficient evidence to convict under the new health care fraud statute Penal Law article 177 et seq.

Held: The Court of Appeals concluded that defendant’s convictions were supported by legally sufficient evidence.

Facts:  The New York City Police Department conducted a joint undercover investigation of NYC Pharmacy, Inc., based on information that prescription drugs were being sold at that location without prescriptions.  An NYPD undercover police officer made seven visits to the pharmacy where he posed as a customer and received pills from defendant or another pharmacy employee. Defendant was arrested and charged with health care fraud in the fourth degree, grand larceny in the third degree and four counts of criminal diversion of prescription medications in the fourth degree.

Gomez visited the pharmacy four times. For each of these visits, he used a manufactured Medicaid benefits card.  Gomez was also supplied with prescriptions for Arroyo which were purportedly signed by a doctor. Prescriptions were generated by the Medicaid Fraud unit for this investigation. During each visit, Gomez handed defendant the Medicaid card and prescription(s) and defendant checked the Medicaid database where he found Arroyo’s name; Gomez then asked to be given Amitriptyline and Clonidine, in varying amounts, instead of the drugs listed in the prescriptions; defendant gave Gomez pills that were not consistent with the prescription, but billed Medicaid in accordance with the prescriptions.

Gomez never identified himself or provided identification to defendant during any of the transactions. Although Gomez counted and vouchered the pills he received after each of the seven visits to NYC Pharmacy, none of them were ever subjected to laboratory analysis.

At the conclusion of the prosecution’s case and again at the close of all proof, defendant, pursuant to CPL 290.10, moved for a trial order of dismissal on the grounds that: the evidence adduced at trial was legally insufficient.

Legal Analysis: In a legal sufficiency inquiry, the Court of Appeals’ role is limited to determining whether, “after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt”.

Where the evidence adduced at trial establishes “‘any valid line of reasoning and permissible inferences [that] could lead a rational person’ to convict, then the conviction survives a sufficiency review”. “A sufficiency inquiry requires a court to marshal competent facts most favorable to the People and determine whether, as a matter of law, a jury could logically conclude that the People sustained its burden of proof”

To establish health care fraud in the fourth degree, the People must prove that the defendant, “with intent to defraud a health care plan . . . knowingly and willfully provide[d] materially false information . . . for the purpose of requesting payment from a health plan for a health care item or service and, as a result of such information, the [defendant] or another person receive[d] payment in an amount [to which the defendant or another] [was] not entitled,” and “the payment wrongfully received . . . from a single health plan in a period of not more than a year exceed[ed] [$3,000] in the aggregate”

Further, grand larceny in the third degree is made out when the People prove that the defendant stole property and that the value of the property exceeds $3,000.

The People presented sufficient evidence for a jury to rationally conclude that the pink and orange pills dispensed to Gomez were different from the drugs listed on the prescriptions presented to defendant and that defendant knowingly and willfully provided materially false information to Medicaid.

Defendant consistently gave Gomez what Gomez asked for, rather than what was prescribed—in the light most favorable to the people, a jury could reasonably infer that the pills were not Sustiva and that Ivonne Arroyo would not be the recipient of the medication, and therefore that defendant knowingly and willfully provided materially false information to Medicaid.