Fourth Circuit Reverses Acquittal in Maryland COVID-19 Health Car

In the long list of things people did during the COVID-19 pandemicbaking sourdough, learning TikTok dances, hoarding toilet paperbilling Medicare at the wrong code level was probably not meant to be one of the headliners. Yet for Maryland physician Dr. Ron Elfenbein, the way his clinics billed for rapid COVID-19 tests landed him in the middle of a closely watched health care fraud case in the U.S. Court of Appeals for the Fourth Circuit.

A jury convicted him on five counts of health care fraud in 2023. The trial judge later threw those convictions out, granting a post-trial acquittal because he believed federal billing guidance was too ambiguous to support a guilty verdict. Then, in July 2025, the Fourth Circuit stepped in, reversing the acquittal, reinstating the jury’s verdict, and sending the case back for a new trial.

This wasn’t just a local drama about one urgent care clinic. The decision in United States v. Elfenbein, No. 24-4048, is now a reference point for how courts treat billing code ambiguity, “reasonable interpretations,” and the line between aggressive billing and criminal fraud in COVID-era health care.

Background: How a COVID Testing Operation Became a Fraud Case

During the height of the pandemic, Dr. Elfenbein operated urgent care clinics in Maryland that pivoted heavily toward COVID-19 testing. According to the Justice Department, the clinics allegedly submitted over $15 million in claims to Medicare and a commercial insurer for patients who primarily came in for quick COVID tests.

The government said the problem wasn’t the tests themselvesit was how the visits were billed. Prosecutors claimed that:

• The clinics billed most encounters using high-level evaluation and management (E/M) codes (often “level 4”), which are usually reserved for more complex visits with substantial medical decision-making.
• Patients, however, allegedly received brief encounters centered on COVID swabbing and standardized counseling that could have been billed at much lower levels.
• Documentation was allegedly tailored to justify the high codes, including repeated boilerplate language about detailed histories and complex decision-making.

In 2022, the government indicted Dr. Elfenbein on multiple counts of health care fraud under 18 U.S.C. § 1347, focusing on a handful of representative patient encounters between March and May 2021. A federal jury in Baltimore later found him guilty on five counts.

From Jury Conviction to Trial Court Acquittal

After the guilty verdict, the district court did something relatively rare: it granted a Rule 29 judgment of acquittal, overruling the jury’s decision. Judge James Bredar concluded that the billing codes at the heart of the case were too ambiguous to support a conviction beyond a reasonable doubt.

In particular, the court pointed to:

• Vague and evolving guidance from CMS and other payers about how to bill COVID-19 testing and associated counseling.
• Conflicting interpretations of E/M coding levels offered by experts on both sides.
• The possibility that a doctor could reasonably believe that using higher-level codes was allowed if counseling was provided, even for short, test-focused visits.

In the district court’s view, if the government couldn’t prove a uniquely correct interpretation of the billing rules, then the jury had too little to go on in finding that the claims were “false” or “fraudulent.”

At the same time, the judge entered a contingent Rule 33 order granting a new trial, reasoning that even if the evidence were legally sufficient, the case was close enough that the interests of justice warranted a do-over.

Enter the Fourth Circuit: Reversing the Acquittal, Keeping the New Trial

On appeal, the Fourth Circuit split the difference in a nuanced way. Writing for the court, Judge Julius Richardson held that:

• The jury had sufficient evidence to convict on the health care fraud counts.
• The district court therefore erred in entering a judgment of acquittal.
• However, the district court’s decision to grant a new trial fell within its discretion, because the case was close and the judge was entitled to weigh the evidence and credibility.

In other words: the acquittal is out, the convictions are back on paper, but the government doesn’t just get to reinstate the verdict. Instead, the case goes back to Maryland for another trial.

Ambiguity in Billing Rules Is Not a Free Pass

The heart of the Fourth Circuit’s reasoning is that ambiguous billing guidance does not automatically insulate a provider from fraud liability. The court emphasized that:

• Ambiguity is a factor, but it doesn’t require acquittal if the jury could reasonably find that the defendant’s interpretation was not just aggressive, but knowingly false or misleading.
• Jurors are allowed to choose between competing interpretations offered by experts and weigh how the provider actually used those interpretations in practice.
• Evidence from the defendant’s own statements and internal documents can strongly support an inference of intent, even when the underlying regulations are complicated.

Commentators in the health law community quickly flagged this as a big deal. Several legal analyses stress that the Fourth Circuit is signaling a clear message: you can’t simply wave the word “ambiguity” like a magic wand and expect criminal liability to disappear, especially if documentation looks crafted to maximize payment rather than reflect actual care.

Why the New Trial Still Stands

Even while reversing the acquittal, the appellate court was candid that the case was close. The evidence wasn’t one-sided; different witnesses and experts painted competing pictures of what proper COVID test billing should look like in 2021.

Because Rule 33 gives trial judges broader discretion, the Fourth Circuit deferred to the district court’s view that justice would be better served by letting a new jury consider the evidence from scratch. That means the government must retry the case rather than simply resurrect the original verdict.

What This Means for Health Care Providers and Compliance Teams

While most clinicians will never see the inside of a federal courtroom, the Elfenbein case has ripple effects for anyone billing Medicare, Medicaid, or commercial insurersespecially when rules are evolving as fast as they did during the COVID-19 public health emergency.

1. Ambiguous Guidance Won’t Automatically Save You

During COVID-19, agencies rushed out new waivers, codes, and payment rules for testing, counseling, and telehealth. That environment naturally produced some gray areas. But the Fourth Circuit’s decision lines up with broader DOJ enforcement trends: regulators are still willing to bring cases when they believe providers exploited those gray areas in ways that look more like profit-maximizing schemes than good-faith confusion.

In short, “The rules are confusing” might help explain a mistake, but it’s not a safe harbor if documentation and internal communications suggest that higher codes were chosen because they paid more, not because they reflected clinical reality.

2. Documentation Is Still King

The government’s case relied heavily on what was written in the medical records and what staff and the doctor said about how those records were created. When charts consistently described detailed histories, complex physical exams, and extensive counseling for what witnesses called quick test encounters, the jury was allowed to infer that the documentation was built to fit the codenot the other way around.

For providers, the lesson is familiar but worth repeating:

• Make sure progress notes actually match what happened during the visit.
• Be skeptical of templates that always default to the highest-paying description of services.
• Train staff so they understand what each E/M level or code truly requires, especially when guidance changes quickly.

3. Compliance Programs Need a “Pandemic Mode” Playbook

Many health care organizations scrambled during COVID-19 to stand up testing sites, telehealth programs, and vaccination clinics. Some did that while also updating their compliance infrastructure. Others, frankly, tried to catch up later.

The Elfenbein case is a reminder that:

• Rapid expansion (new locations, new services, pop-up clinics) should trigger rapid risk assessments.
• High-volume billing for a narrow set of codesespecially new codesshould get extra review, audits, or pre-billing checks.
• Written policies about how to interpret gray guidance can help document good faith, but they need to be consistent with widely accepted coding principles and credible clinical practice.

None of this guarantees that an organization will avoid government scrutiny, but it makes it much easier to show that decisions were made thoughtfully rather than opportunistically.

4. This Is Part of a Larger COVID-19 Enforcement Story

The DOJ has spent years pursuing pandemic-related fraud: relief fund misuse, sham testing sites, fake labs, and more traditional upcoding schemes. Enforcement has been uneven, but cases like Elfenbein demonstrate that authorities are still litigating the boundaries between aggressive billing and criminal fraud even years after the early waves of the pandemic.

For providers, this means that old pandemic-era billing decisions can still show up in enforcement actions, audits, or whistleblower suits today.

Practical Takeaways for Clinics, Hospitals, and Billing Teams

1. Treat “gray areas” as high risk, not as open season.

If guidance is genuinely unclear, document the basis for your interpretation, including who reviewed it (compliance, counsel, external coders) and why you rejected other options. That kind of paper trail can help distinguish good-faith judgment from after-the-fact rationalization.

2. Align incentives carefully.

When staff compensation or clinic revenue is heavily tied to visit counts and code levels, you create strong financial incentives to push into higher E/M codes. That’s not automatically illegal, but it makes it harder to argue that billing decisions were purely clinical. Consider balancing volume-based incentives with quality, compliance, or documentation metrics.

3. Audit “boring” services, not just flashy new programs.

Simple, repetitive services (like COVID-19 testing, vaccine clinics, or screening programs) may look low risk precisely because they’re routine. But those are the services where upcoding can quietly add up to millions of dollars. Regular coding audits targeting these bread-and-butter visits can uncover systemic issues early.

4. When in doubt, get specialized advice.

Coding and billing questions, especially in the Medicare and Medicaid context, can be surprisingly technical. Health care organizations should work with experienced compliance professionals and, where appropriate, legal counsel to interpret ambiguous rules and document those interpretations. This article is for general information only and is not legal advice.

Real-World Experiences and Lessons from the Elfenbein Case

To make this more concrete, it helps to imagine what this kind of case looks like on the ground. While the details of United States v. Elfenbein are unique, the themes will feel familiar to anyone who lived through pandemic-era health care operations.

Experience 1: The Overwhelmed COVID Testing Clinic

Picture an urgent care clinic parking lot in 2021: cars lined up, staff in PPE, and a constant flow of patients whose primary goal is simple“I just need to know if I’m positive.” Everything has to be done at high speed. Staff members are trying to register patients, swab, document, counsel, and move on to the next car before traffic backs up around the block.

In that chaos, the clinic’s leadership decides that every test will be billed at the same higher E/M level because:

• “There’s counseling involved every time.”
• “We’re dealing with a novel virusthis is complex by definition.”
• “Everyone else must be billing it this way too.”

On paper, that might sound plausible. But when investigators later pull a sample of charts, they see very short visits, limited history, and templated language that looks copy-and-paste across virtually every record. That’s the kind of fact pattern that can make jurors think: this looks more like an upcoding strategy than individualized clinical judgment.

Experience 2: The Compliance Officer’s Audit Nightmare

Now switch perspectives. Imagine you’re the compliance officer who starts a routine internal audit in 2023 and discovers that your organization billed nearly every COVID testing encounter at a high-level E/M code.

You pull a random sample:

• Visit notes are short, repeated, and heavily templated.
• “Extensive counseling” is documented in phrases, but not in substanceno real detail about risks, options, or shared decision-making.
• Time-based billing is claimed, but the timestamps suggest visits lasted only a few minutes.

You suddenly realize you’re looking at a potential repayment issue at best, and at worst, conduct that could draw government attentionespecially if a former employee or billing vendor files a whistleblower complaint. At that moment, the Fourth Circuit’s message in Elfenbein feels very real: ambiguity in guidance is not a shield if the documentation and coding look like a deliberate pattern of upcoding.

Organizations in this position often respond by:

• Expanding the audit sample and quantifying potential overpayments.
• Talking with counsel about whether to make a voluntary disclosure or self-report.
• Re-training providers on how to document and bill similar services going forward.

While those steps can be painful and expensive, they may be far less painful than a criminal indictment or a civil False Claims Act lawsuit.

Experience 3: The Physician Facing a Jury

Finally, consider what it feels like to be the physician at the center of a case like this. In the courtroom, every billing decision from years ago is dissected. Internal emails, text messages, and staff testimony about “how we did things” are reread with the benefitand harshnessof hindsight.

A jury hears two competing stories:

• The government’s story: The doctor knowingly inflated codes for simple COVID tests, used boilerplate documentation to justify high payments, and treated billing rules as revenue tools instead of compliance obligations.
• The defense story: The doctor was trying to follow confusing guidance, believed counseling and risk justified higher codes, and focused on patient access during a global emergency.

The Fourth Circuit’s opinion shows that, in close cases, juries are allowed to pick one story over the otherand appellate courts will not casually overturn those choices. That reality is sobering for providers who rely on informal “this is probably fine” interpretations of complex billing rules.

At the same time, the fact that the new trial order was upheld is a reminder that trial judges still have an important safety valve when they believe a verdict doesn’t fully reflect the weight of the evidence. In practice, that means both sides will need to sharpen their presentations in the next round.

Conclusion: Why the Elfenbein Decision Matters Going Forward

The Fourth Circuit’s reversal of the trial court’s acquittal in this Maryland COVID-19 health care fraud case sits at the intersection of three powerful forces: pandemic-era chaos, complex billing rules, and the government’s long-running focus on fraud and abuse in the health care system.

For providers and compliance professionals, the case underscores a simple but uncomfortable truth: you don’t get a free pass just because the rules are complicated. When documentation, coding choices, and internal communications point toward a deliberate strategy to maximize revenue, courts and juries may be willing to find fraud even in gray regulatory zones.

For the government, the decision reinforces that criminal health care fraud prosecutions can succeed even in evolving guidance environmentsprovided there is strong evidence of intent. At the same time, the new trial order reminds prosecutors that close cases can still face significant headwinds at the trial court level.

For everyone else, including patients, the case is a reminder that how care is billed can be just as consequential as how it is provided. When those two diverge too much, appellate opinions like United States v. Elfenbein are the result.