OCTOBER TERM, 1999
certiorari to the united states court of appeals for the eleventh circuit
No. 99-116. Argued February 22, 2000—Decided May 15, 2000
Petitioner, while president and part owner of Quality Medical Consultants,
Inc. (QMC), negotiated a $1.2 million loan to QMC from West Volusia Hospital Authority (WVHA), a municipal agency responsible for operating two Florida hospitals, both of which participate in the federal Medicare program. In 1993 WVHA received between $10 and $15 million in Medicare funds. After a 1994 audit of WVHA raised questions about the QMC loan, petitioner was indicted for violations of the federal bribery statute, including defrauding an organization which receives benefits under a federal assistance program, 18 U. S. C. § 666(a)(1)(A), and paying a kickback to one of its agents, § 666(a)(2). A jury convicted him on all counts, and the District Court sentenced him to imprisonment, imposed a term of supervised release, and ordered the payment of restitution. On appeal petitioner argued that the Government failed to prove WVHA, as the organization affected by his wrongdoing, received "benefits in excess of $10,000 under a Federal program," as required by § 666(b). In rejecting that argument and affirming the convictions, the Eleventh Circuit held that funds received by an organization constitute "benefits" within § 666's meaning if the source of the funds is a federal program, like Medicare, which provides aid or assistance to participating organizations.
Held: Health care providers such as the one defrauded by petitioner receive "benefits" within the meaning of § 666(b). Pp. 671-682.
(a) Medicare's nature and purposes provide essential instruction in resolving this controversy. Medicare is a federally funded medical insurance program for the elderly and disabled. The Federal Government is the single largest source of funds for hospitals participating in Medicare. Such providers qualify to participate upon satisfying a comprehensive series of statutory and regulatory requirements, including licensing, quality assurance, staffing, and other standards. Compliance with these standards provides the Government with assurance that participating providers possess the capacity to fulfill their statutory obligation of providing "medically necessary" services "of a quality which meets professionally recognized standards of health care." 42 U. S. C. § 1320c-5(a). Medicare attains its objectives through an elaborate funding structure designed not only to compensate providers for the reason-
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