Sufficiency of the evidence for health care fraud convictions; FRE 404(b) “propensity evidence”; Jury instructions as to local coverage determinations (LCDs); Whether there was a “material variance” from the indictment; Prosecutorial misconduct; Conflict-of-interest waiver; Sentencing; Procedural reasonableness; Loss amount calculation; USSG § 2B1.1

The court held that there was sufficient evidence to support defendant-Siefert’s health care fraud conviction where the evidence showed that he performed medically unnecessary tests to obtain the highest Medicare reimbursement. It also rejected his prosecutorial misconduct claim where the district court had not prohibited the government’s introduction of patient death evidence and where “the government’s inability to ultimately show Siefert’s knowledge does not constitute lack of good faith.” A jury found Siefert guilty of health care fraud and defendant-Ehn guilty of the same offense and conspiracy to commit it, arising from a scheme involving a pain management clinic, “specialized urine drug tests,” and Medicare reimbursement. Ehn argued there was insufficient evidence to support either of his convictions. But the court held that there was enough evidence to convince a reasonable juror given the evidence that he knew he was not qualified to perform the testing and that the testing machine was malfunctioning, but he continued to bill “for the unreliable, medically unnecessary tests the machine produced.” This same evidence supported the conspiracy conviction where Ehn and Siefert planned to do unnecessary “definitive testing” and to share the profits. The court also upheld the admission of evidence of Ehn’s prior improper billing practices under FRE 404(b)(2). It further found that the district court did not abuse its discretion by declining to give a jury instruction requested by Ehn about LCDs, concluding the proposed instruction incorrectly stated the law. Next, it found no material variance from the indictment, determining the “stated method, manner, and means of fraud” gave Ehn adequate notice of the charges he would need to defend. That the government’s trial evidence went into further detail did not mean it varied from the indictment. His conflict of interest claim also failed where he signed a waiver regarding his trial counsel’s possible conflict. Siefert argued that the introduction of evidence about seven uncharged patient deaths constituted prosecutorial misconduct. But the district court’s pretrial ruling on this evidence was not a “hard-and-fast prohibition against” its introduction. The court agreed “with the district court that the evidence relating to patient deaths was relevant and not unduly prejudicial” and concluded that the prosecution did not act improperly. Lastly, it held that defendants’ sentences were procedurally reasonable where the district court’s loss amounts were supported by their own expert and were a “reasonable estimate” of the financial loss caused by their fraud. Affirmed.