Court: United States Court of Appeals for the First Circuit

Filed: 2026-09-21

The First Circuit affirmed Gustavo Kinrys’s conviction and sentence for health insurance fraud, rejecting his challenges to the district court’s calculation of intended loss for sentencing enhancements and the amount of restitution ordered. Regarding the sentencing enhancement, the court applied the *Alphas* burden-shifting framework under U.S.S.G. § 2B1.1, which permits a sentencing court to use the face value of billed amounts as prima facie evidence of intended loss in fraud cases rife with deception. The burden then shifts to the defendant to rebut this presumption by proffering evidence that they subjectively intended to receive a lesser amount. Although Kinrys argued that his status as an “in-network” provider meant he only intended to receive the lower contract reimbursement rates, the appellate court found no clear error in the district court’s factual determination that Kinrys intended to “scoop” as much as possible up to the billed amounts. This conclusion was supported by evidence that Kinrys filed civil suits seeking damages based on full billed charges rather than contract rates and that he retained payments exceeding contract amounts when insurers paid them. On the issue of restitution under the Mandatory Victims Restitution Act, 18 U.S.C. § 3663A(c)(1)(A)(ii), the court affirmed the order requiring Kinrys to pay over $6.5 million to victims. Kinrys argued that this amount should be offset by claims for legitimate services he rendered but was never paid for, contending that failing to do so would confer a windfall on the insurers. The court rejected this argument, holding that a criminal restitution hearing is not the proper venue to resolve distinct, contested civil billing disputes or to determine whether Kinrys is entitled to payment for unpaid claims. Such issues must be resolved through separate civil litigation or administrative processes with the insurers, rather than by offsetting the restitution order in the criminal sentencing proceeding. As a result, the district court’s judgment imposing the prison term and restitution order stands without modification.

Do It For The Case Law is a news reporting service. Nothing in this episode constitutes legal advice.