Billed Claims May Establish Intended Loss Despite Contracted Reimbursement Rates

United States v. Kinrys · United States Court of Appeals for the First Circuit · September 21, 2026

Introduction

Gustavo Kinrys, a Massachusetts psychiatrist, was convicted of defrauding health insurers by billing for services he had not provided. His sentencing appeal raised two distinct questions: whether his intended loss was the more than $19 million he billed or approximately $8.3 million in anticipated in-network reimbursements, and whether unpaid claims for allegedly legitimate services should reduce the restitution owed to insurers.

Summary of the Opinion

The First Circuit affirmed both rulings. The district court could reasonably find that Kinrys intended to obtain up to the amounts he billed, notwithstanding his contracted reimbursement rates. It also properly declined to reduce restitution for separate, disputed claims that insurers had not paid. The judgment left intact a twenty-level loss enhancement and a restitution order of $6,537,309.59.

Analysis

Precedents Cited

• Loss calculation. United States v. Alphas supplies the central framework: when claims are rife with fraud, their face value is prima facie evidence of intended loss, which the defendant may rebut with evidence of a lesser intended amount. United States v. Yoon reiterates that approach while keeping the ultimate burden of proving the enhancement on the government. The court distinguished United States v. Yoon because its provider was out of network and did not know what each claim would yield. United States v. Iwuala supports examining whether the defendant meant to take as much as possible; United States v. Carrasquillo-Vilches identifies the controlling inquiry as the financial harm the defendant purposely sought to cause.
• Evidence of intent and appellate review. United States v. Singh lends force to Kinrys’s argument that providers may know insurers’ fixed payment rates; the First Circuit acknowledged that point without treating it as conclusive. United States v. Arif treats subjective intent as a factual question. United States v. Gonzalez, quoting United States v. Centeno-González, explains that reversal for clear error requires a definite and firm conviction that the district court was mistaken. Rios v. Centerra Grp. LLC reinforces that counsel’s argument cannot replace missing evidence.
• Restitution. United States v. Simon and United States v. De Jesús-Torres describe criminal restitution as compensation for actual loss rather than punishment. United States v. Carrasquillo-Vilches, drawing on United States v. Innarelli and United States v. Naphaeng, frames its aim as making victims whole without giving them a windfall. United States v. Alphas also establishes that legitimate claims included in a fraud-loss calculation must be separated out. Kinrys’s proposed offset was different: it concerned other claims, not legitimate items mistakenly included in the restitution total. United States v. Maurer and United States v. Cupit support leaving those contested reimbursement demands to civil or administrative proceedings.
• Standards and guidelines. United States v. Cardozo provides the restitution-review standard, while United States v. Yoon addresses review of an enhancement. The court noted that Beaird v. United States concerns deference to sentencing-guideline commentary, but found no need to resolve that question: the loss definition had been moved into the guideline text. Citing Unites States v. Cates as titled in the opinion, it treated that change as a clarifying amendment applicable here.

Legal Reasoning

Intended loss. The guideline uses the greater of actual and intended loss. Because Kinrys’s claims were pervasively fraudulent, the district court began with their billed value. His in-network contracts were meaningful rebuttal evidence: they specified lower reimbursement rates and made an expectation of roughly $8.3 million plausible. But they did not compel that finding. The district court also considered Kinrys’s later lawsuits seeking billed charges from insurers and evidence that he retained occasional payments of the full billed amount. His failure to collect patient co-pays did not establish a lower intended take from insurers. Kinrys offered no additional evidence at sentencing to explain away the lawsuits or overpayments. On that record, the appellate court found no clear error in the determination that he sought as much as insurers would pay, up to the billed amounts.

Restitution. Kinrys conceded that the $6.5 million calculation itself comprised fraudulent claims. He instead sought credit for different, allegedly legitimate claims that went unpaid. Whether insurers owe those sums remained contested, including because payment had been conditioned on preauthorization or production of records. The court held that a criminal restitution hearing was not the forum to decide those separate reimbursement disputes. Declining the offset therefore did not award insurers a windfall on the losses established in this case.

Impact

The decision does not establish that every fraudulent bill sets intended loss at its face value. Contracted rates can support a lower figure, but a sentencing court may weigh them against evidence that the defendant pursued or accepted more. Defendants seeking a lower intended-loss finding will need evidence of their actual expectations, not merely the existence of an in-network contract. The ruling also preserves a boundary around criminal restitution: courts must exclude legitimate transactions from proven fraud losses, but need not adjudicate unrelated, disputed debts as offsets.

Complex Concepts Simplified

• Intended versus actual loss: Intended loss asks how much money the defendant meant to take; actual loss asks how much was lost. The sentencing guideline uses the larger figure.
• Prima facie evidence: The billed amount is a permissible starting point, not an irrebuttable answer. The defendant can present evidence of a lower intended amount, while the government retains the ultimate burden of proving the enhancement.
• Clear error: An appellate court does not choose whichever factual interpretation it prefers. It reverses only when the lower court’s finding leaves it firmly convinced a mistake occurred.
• Restitution versus forfeiture: Restitution compensates victims for their actual losses. Forfeiture is a separate remedy directed at proceeds of crime; the opinion’s challenge concerned restitution, not the forfeiture order.

Conclusion

United States v. Kinrys underscores that intended loss turns on a defendant’s proven purpose, not reimbursement contracts alone. It also confirms that disputed claims for other unpaid services cannot be resolved by simply subtracting them from criminal restitution.