In the

United States Court of Appeals

For the Seventh Circuit ____________________

No. 19-1632

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

KEVIN W. SCHAUL,

Defendant-Appellant.

____________________

Appeal from the United States District Court for the

Central District of Illinois.

No. 3:16-cr-30067-SEM-TSH-1 — Sue E. Myerscough, Judge.

____________________

ARGUED FEBRUARY 14, 2020 — DECIDED JUNE 18, 2020

____________________

Before RIPPLE, SYKES, and SCUDDER, Circuit Judges.

RIPPLE, Circuit Judge. Kevin Schaul pleaded guilty to five 

counts of health care fraud in violation of 18 U.S.C. § 1347. 

He now challenges his conviction, submitting that his guilty 

plea was not knowing and voluntary because he never was 

informed of the elements of the offense.

The indictment gave Mr. Schaul sufficient notice of the 

charges. However, he was informed erroneously of the mens 
2 No. 19-1632

rea required by the statute; such an affirmative misrepresentation of the elements of the offense constitutes plain error. 

We conclude nevertheless that this error did not affect 

Mr. Schaul’s substantial rights. The record affirmatively 

demonstrates that he knowingly and willfully violated the 

law. We therefore affirm the judgment of the district court.1

I.

BACKGROUND2

Mr. Schaul owned and operated ChildRite Medical Supply, a business that participated in the Medicaid program by 

suppling incontinence supplies for special-needs individuals. From August 2009 to September 2013, Mr. Schaul submitted claims for reimbursement to the Illinois Department 

of Healthcare and Family Services, which reimburses the 

cost of certain medical supplies provided to eligible individuals through Medicaid. Although Mr. Schaul reported that 

ChildRite had delivered roughly four million units during 

the years in question, approximately one million of those 

units did not exist. He obtained $582,844.10 from Medicaid 

for those nonexistent items. 

A grand jury indicted Mr. Schaul for five counts of health 

care fraud under 18 U.S.C. § 1347. The indictment charged 

that Mr. Schaul 

1 The jurisdiction of the district court was predicated on 18 U.S.C. § 3231. 

Our jurisdiction is secure under 28 U.S.C. § 1291.

2 The district court adopted the factual findings of the presentence report. R.76 at 6. The parties do not dispute the facts. 
No. 19-1632 3

knowingly devised and participated in a 

scheme to defraud Medicaid ... and to obtain 

Medicaid funds by means of material false 

statements, pretenses, representations, and 

promises. As part of the scheme, Defendant 

Schaul, through ChildRite, repeatedly submitted and caused to be submitted false and 

fraudulent Medicaid claims ... for the delivery 

of incontinence products that he represented 

had been provided to Medicaid recipients ... 

when in fact, as Defendant Schaul well knew, 

no such products had been delivered or had 

not been delivered in the amount claimed.3

Mr. Schaul, who was represented by counsel during all proceedings in the district court, entered into a written plea 

agreement. The agreement contained language describing a 

“scheme to defraud Medicaid” that was substantially identical to the one described in the indictment.4 The agreement 

also stated that Mr. Schaul’s counsel had “fully explained” 

to him the indictment and the charges and that Mr. Schaul 

fully understood the nature and elements of the crimes to 

which he was pleading guilty.5

The plea agreement erroneously stated, however, that, 

under § 1347, the Government needed to prove beyond a 

reasonable doubt that the defendant “knowingly or willfully 

3 R.1 at 3–4.

4 Compare R.39 at 12–13, with R.1 at 3–4.

5 R.39 at 3.
4 No. 19-1632

executed or attempted to execute the scheme [to defraud].”6

The statute requires the Government to prove that the defendant acted “knowingly and willfully.” 18 U.S.C. § 1347(a) 

(emphasis added). Specifically, the statute provides in relevant part:

(a) Whoever knowingly and willfully executes, 

or attempts to execute, a scheme or artifice—

(1) to defraud any health care benefit program; or

(2) to obtain, by means of false or fraudulent pretenses, representations, or promises, 

any of the money or property owned by, or 

under the custody or control of, any health 

care benefit program, in connection with 

the delivery of or payment for health care 

benefits, items, or services, shall be [punished] ...

(b) With respect to violations of this section, a 

person need not have actual knowledge of this 

section or specific intent to commit a violation 

of this section.

§ 1347. 

Mr. Schaul entered his guilty plea at a hearing before a 

magistrate judge. He agreed with the Government’s factual 

6 Id. (emphasis added). The plea agreement defined “knowingly” as indicating that “the defendant realized what he was doing and was aware 

of the nature of his conduct, and did not act through ignorance, mistake 

or accident.” Id. at 4. It did not define “willfully.”
No. 19-1632 5

allegations. He stated that he had had sufficient time to discuss the charges with counsel and had done so; that he understood the charges against him; that he had no questions 

about the nature of the charges; and that he was satisfied 

with his counsel’s representation.7 When counsel for the 

Government explained the elements of the offense, he read 

from the plea agreement, which, as we have noted, incorrectly stated the mens rea required to violate § 1347.8

In due course, after accepting the guilty plea, the district 

court sentenced Mr. Schaul to twenty-four months’ imprisonment followed by three years of supervised release and 

ordered him to pay $582,844.10 in restitution. Mr. Schaul 

timely appealed. After his trial counsel filed a motion to 

withdraw, Mr. Schaul filed a pro se motion to delay the date 

of his reporting to the Bureau of Prisons. The district court 

denied the motion; Mr. Schaul filed a motion to reconsider 

and stated, for the first time, that he could “prove ... there 

was no intent to commit fraud.”9 The district court denied 

the motion for reconsideration.

II.

DISCUSSION

A.

Mr. Schaul submits that his guilty plea was invalid because it was not entered knowingly and voluntarily as re7 R.75 at 7–8, 10.

8 Id. at 8.

9 R.69 at 2.
6 No. 19-1632

quired by Rule 11 of the Federal Rules of Criminal Procedure.10 Because Mr. Schaul did not move to withdraw his 

plea at the district court, our review is for plain error. United 

States v. Vonn, 535 U.S. 55, 58–59 (2002) (holding that “a defendant who lets Rule 11 error pass without objection in the 

trial court ... has the burden to satisfy the plain-error rule”). 

Under that standard, we may reverse the judgment of the 

district court only if we decide: (1) that an error occurred; (2) 

that the error was plain; and (3) that the error affected the 

defendant’s substantial rights. United States v. Olano, 507 U.S. 

725, 732 (1993); United States v. Corona-Gonzalez, 628 F.3d 336, 

340 (7th Cir. 2010). If a court determines that these criteria 

are satisfied, it may, in its discretion, reverse if the error “seriously affect[ed] the fairness, integrity or public reputation 

of judicial proceedings.” Olano, 507 U.S. at 732 (quotation 

marks omitted). 

10 Rule 11 of the Federal Rules of Criminal Procedure ensures that a defendant’s plea is knowing and voluntary. Before the court accepts a 

guilty plea, it must ensure that the defendant understands, among other 

things, “the nature of each charge to which the defendant is pleading.” 

Fed. R. Crim. P. Rule 11(b)(1)(G). Further, before accepting a guilty plea, 

“the court must address the defendant personally in open court and determine that the plea is voluntary.” Id. at (b)(2). See United States v. 

Pineda-Buenaventura, 622 F.3d 761, 768 (7th Cir. 2010) (concluding that 

Rule 11 was not satisfied when it was not clear that the defendant understood the nature of the charge to which he pleaded guilty). Although 

Mr. Schaul waived his right to appeal by pleading guilty, he is “entitled 

to challenge his plea on knowledge and voluntariness grounds despite 

the plea waiver.” United States v. Olson, 880 F.3d 873, 880 (7th Cir. 2018).
No. 19-1632 7

B.

Mr. Schaul challenges the validity of his plea on two 

fronts. First, he contends that he did not receive sufficient 

notice of the nature of the charges against him because the 

Government never made clear whether it was charging him 

with a violation of § 1347(a)(1) or of § 1347(a)(2). Second, he 

submits that he was not apprised adequately that the statute 

required that he commit the crime knowingly and willfully. 

The general principles governing our evaluation of both 

of these contentions are well-settled. Because a guilty plea 

waives important rights, it is valid only when it is entered 

“voluntarily, knowingly, and intelligently, ‘with sufficient 

awareness of the relevant circumstances and likely consequences.’” Bradshaw v. Stumpf, 545 U.S. 175, 183 (2005) (quoting Brady v. United States, 397 U.S. 742, 748 (1970)). A district 

court must ensure that the record adequately demonstrates 

that a defendant understands the nature of the charges 

against him, including the elements of the crime. Id.; see Henderson v. Morgan, 426 U.S. 637, 645 (1976). Within this general 

framework, we now turn to an examination of each of 

Mr. Schaul’s specific contentions.

1.

Mr. Schaul first submits that he was not given adequate 

notice of the charge against him. As we noted earlier, he 

submits that the indictment failed to notify of the subsection 

of the statute he allegedly violated. 

The principles governing our analysis of this contention 

are well-established. A defendant is entitled to understand 

the nature of each charge against him, including the elements of the crime. Bradshaw, 545 U.S. at 183. When there is 
8 No. 19-1632

general confusion over the elements of the crime with which 

a defendant is charged, the resulting guilty plea cannot 

stand. Bousley v. United States, 523 U.S. 614, 618–19 (1998). A 

plea is invalid when the record reveals that neither the defendant, nor his counsel, nor the court correctly understood 

the essential elements of the crime with which the defendant 

was charged. Id.

This principle must be applied in a practical way. An indictment must notify the defendant of the nature of the 

charges against him, but it need not precisely mimic the 

words of the relevant statute.11 “Indictments are reviewed 

on a practical basis and in their entirety”; their function is to 

provide enough factual allegations to “pin[] down the specific conduct at issue.” United States v. Smith, 230 F.3d 300, 305 

(7th Cir. 2000).

Application of this principle to the present case requires 

that, as a first step, we set forth the elements of the statute 

underlying Mr. Schaul’s conviction. An individual violates 

the health care fraud statute, 18 U.S.C. § 1347, by “knowingly and willfully execut[ing], or attempt[ing] to execute, a 

scheme or artifice” to either: (1) “defraud any health care

benefit program” or (2) “obtain, by means of false or fraudulent pretenses, ... money or property owned by, ... any 

health care benefit program.” § 1347(a)(1)–(2). Mr. Schaul 

contends that, because the indictment against him employed 

language from both subsections, he could not identify with 

sufficient precision the crime of which he was accused. In his 

view, § 1347(a) tracks very closely the language of the bank 

11 United States v. Harvey, 484 F.3d 453, 456 (7th Cir. 2007).
No. 19-1632 9

fraud statute, 18 U.S.C. § 1344,12 and therefore should be interpreted along the same lines as that statute.13 Mr. Schaul 

submits that because §§ 1347(a)(1) and (a)(2), like the two 

subsections of the bank fraud statute, are listed in the disjunctive, they constitute two distinct offenses. 

In his view, because the two subsections “criminalize[] 

different behavior,” the failure to specify the subsection with 

which he is charged renders it impossible for him to have 

proper notice of the elements of his offense.14

Our decision in United States v. Harvey, 484 F.3d 453, 456 

(7th Cir. 2007), is instructive. There, the Government 

charged the defendant with violating 18 U.S.C. § 924(c)(1), 

12 The text of 18 U.S.C. § 1344, the bank fraud statute, is below. The 

words in italics are those that differ from 18 U.S.C. § 1347(a), the health 

care fraud statute. 

Whoever knowingly executes, or attempts to execute, a 

scheme or artifice —

(1) to defraud a financial institution; or

(2) to obtain any of the moneys, funds, credits, assets, 

securities, or other property owned by, or under the 

custody or control of, a financial institution, by means 

of false or fraudulent pretenses, representations, or 

promises; 

shall be [punished] ... .

13 Cf. Smith v. City of Jackson, 544 U.S. 228, 233 (2005) (“[W]hen Congress 

uses the same language in two statutes having similar purposes, ... it is 

appropriate to presume that Congress intended that text to have the 

same meaning in both statutes.”).

14 Appellant’s Br. 17.
10 No. 19-1632

which makes it a crime to “use[] or carr[y] a firearm, or ... in 

furtherance of any [violent or drug trafficking] crime, possess[] a firearm ... .” Harvey contended that this subsection 

contained two separate offenses, separated by the disjunctive “or.” He argued that, because the indictment contained 

a mix of the language of the two allegedly separate offenses, 

it was invalid. Harvey, 484 F.3d at 455–56. We concluded, 

however, that whether the statute was read to encompass 

two separate offenses or one, “the separate parts of § 924(c) 

criminalize similar behavior.” Id. at 456. The indictment notified Harvey that he was “charged with what the statute as a 

whole aims to prevent: carrying a firearm that is closely 

connected to an underlying drug offense.” Id. Similarly, here 

the indictment explained to Mr. Schaul that he was charged 

with executing a scheme to submit fraudulent Medicaid 

claims and pocket the money. 

Mr. Schaul also submits that the two subsections of 

§ 1347 contain different elements. Accepting Mr. Schaul’s 

invitation to analogize the bank fraud statute to the health 

care fraud statute, we note that the comparison supports the 

Government’s position. We have held, with respect to the 

bank fraud statute, that “where a statute defines two or 

more ways in which an offense may be committed, all may 

be alleged in the conjunctive in one count in order to adequately apprise the defendant of the government’s intention 

to charge him under either prong of the statute.” United 

States v. LeDonne, 21 F.3d 1418, 1427 (7th Cir. 1994). This was 

so even though the Government’s use of mixed language 

from both subsections of the bank fraud statute “might have 

blurred the elements of the offense, and possibly confused 

[the defendant]’s understanding of the charge.” Id.
No. 19-1632 11

Here, the indictment listed the statute under which 

Mr. Schaul was charged and provided factual particulars 

about the alleged wrongdoing. The indictment therefore 

provided sufficient notice that the Government charged him 

with having violated both subsections of the statute. See 

United States v. Franklin, 547 F.3d 726, 731 (7th Cir. 2008) (declining to reverse where an indictment both identified the 

statute under which the defendant was charged and provided “specifics about ... the conduct that ran afoul of the statute”). 

2.

Mr. Schaul next submits that, even if he had notice of the 

conduct for which he was being charged, the Government 

affirmatively misrepresented the mental state that it was required to prove. This is plain error; as Mr. Schaul puts it, the 

Government “undersold [its] burden of proof.”15

Throughout the proceedings, the Government stated 

Mr. Schaul had to “knowingly or willfully” commit the proscribed acts.16 The statutory language requires, however, 

that a defendant act “knowingly and willfully.” § 1347(a) 

(emphasis added). The Government acknowledges that 

Mr. Schaul must be informed of the correct mens rea requirement. It asks us, nevertheless, to place the responsibility on defense counsel to inform the defendant. It points out 

that both Mr. Schaul and his attorney represented that they 

15 Appellant’s Br. 10.

16 R.39 at 3 (emphasis added); see R.1 at 3 (charging that the defendant 

“knowingly devised and participated in a scheme to defraud Medicaid”) 

(emphasis added).
12 No. 19-1632

had adequate time and opportunity to discuss the charges 

and had no questions about them. We may conclude, urges 

the Government, that Mr. Schaul was sufficiently apprised of 

the correct elements of the offense. 

It is true that “[w]here a defendant is represented by 

competent counsel, the court usually may rely on that counsel’s assurance that the defendant has been properly informed of the nature and elements of the charge to which he 

is pleading guilty.” Bradshaw, 545 U.S. at 183. If Mr. Schaul 

had been provided with a copy of his indictment that contained a correct statement of the elements, that would “give 

rise to a presumption that the defendant was informed of the 

nature of the charge against him.” Bousley, 523 U.S. at 618.

Here, however, the Government did not simply neglect to 

state the elements of health care fraud; it affirmatively misrepresented them. According to both the written indictment 

and the statements made by the prosecution at the plea hearing, Mr. Schaul could be found guilty of health care fraud if 

he acted knowingly or willfully. Those affirmative statements were incorrect. Notably, moreover, neither the court 

nor defense counsel corrected the misstatement, and we see 

no reason to indulge in the fiction that Mr. Schaul’s counsel 

did in private what all present failed to do in open court. If 

“neither [the defendant,] nor his counsel, nor the court correctly understood the essential elements of the crime with 

which he was charged ... [the] plea [is] ... constitutionally 

invalid.” Id. at 618–19. When all parties involved in a plea 

hearing misapprehended the law, we will not place the burden of the mutual mistake on the defendant.

Nonetheless, we must remember that our review is for 

plain error. To prevail under this standard, Mr. Schaul must 
No. 19-1632 13

show not only that an error occurred and that it was plain, 

but also that it affected his substantial rights. See Corona-Gonzalez, 628 F.3d at 340. Only then may we remedy an 

error that “seriously affect[ed] the fairness, integrity or public reputation of judicial proceedings.” Olano, 507 U.S. at 732 

(quotation marks omitted).

Given the case law, it is evident that, under the circumstances here, a failure to set forth the elements of the charged 

offense—including the crucial element of the mental state 

required to violate the statute—is plain error. However, 

Mr. Schaul cannot show that such an error affected his substantial rights. “[A] defendant who seeks reversal of his conviction after a guilty plea, on the ground that the district 

court committed plain error under Rule 11, must show a reasonable probability that, but for the error, he would not have 

entered the plea.” United States v. Dominguez Benitez, 542 U.S. 

74, 83 (2004). Mr. Schaul has offered no more than an assertion that he might have calculated his strategy differently 

had he been informed of the nature of his charges.17

More importantly, it is clear that Mr. Schaul did act 

knowingly and willfully in violating the health care fraud 

statute, which 

makes it a crime to “knowingly and willfully 

execute[ ], or attempt[ ] to execute, a scheme or 

17 Mr. Schaul asserts that “[t]here is a reasonable probability that 

Mr. Schaul would have ‘assessed his strategic position differently’ had 

he realized that the government was required to prove his intent to defraud.” Appellant’s Br. 26 (quoting United States v. Sura, 511 F.3d 654, 662 

(7th Cir. 2007)). 
14 No. 19-1632

artifice: ... (1) to defraud any health care benefit 

program; or ... (2) to obtain, by means of false 

or fraudulent pretenses, representations, or 

promises, any of the money or property owned 

by, or under the custody or control of, any 

health care benefit program, in connection with 

the delivery of or payment for health care benefits, items, or services.”

United States v. Davis, 471 F.3d 783, 785 n.1 (7th Cir. 2006) (alterations in original) (quoting 18 U.S.C. § 1347). Mr. Schaul 

does not contest that he acted knowingly, but he argues that 

he lacked the “intent to defraud.”18 We have said that “intent to defraud ... requires a specific intent to deceive or mislead.” United States v. Natale, 719 F.3d 719, 741 (7th Cir. 2013). 

It is evident, however, that Mr. Schaul’s conduct meets this 

definition.

In the plea agreement, Mr. Schaul stipulated to certain 

facts, including that over the course of at least four years, he 

“knowingly devised and participated in a scheme to defraud 

Medicaid ... and to obtain Medicaid funds by means of material false statements ... [and] representations.”19 He submitted numerous false claims for products that he represented had been provided to Medicaid recipients but, “as [he] 

well knew,” no such products had been delivered.20 He also 

admitted that as part of the scheme he had converted the 

18 Appellant’s Br. 26.

19 R.39 at 12.

20 Id. at 12–13.
No. 19-1632 15

funds received from fraudulent claims to his own personal 

use. 

Mr. Schaul therefore has admitted facts that establish that 

his violation of the health care statute was both knowing and

willful. He submitted false claims to Medicaid for products 

that were never delivered, fraudulently obtaining Medicaid 

funds that he put to personal use. It is clear that he intended 

to defraud Medicaid, and indeed did, to the tune of over half 

a million dollars. Although the district court erred in allowing a misstatement of the elements of the offense to stand 

uncorrected, this error was of no consequence because 

Mr. Schaul has admitted facts that make clear that his violation was willful. The error, therefore, had no effect on his 

substantial rights, and Mr. Schaul has not met the standard 

for reversal under plain error review.

Conclusion

The indictment adequately informed Mr. Schaul of the 

Government’s charge. Although the district court plainly 

erred in letting stand a misstatement of the requisite scienter, 

Mr. Schaul’s own statements demonstrate that the offense 

was committed both knowingly and willfully. Therefore, we 

affirm the judgment of the district court.

AFFIRMED