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Nationwide Takedown of Medicare Fraudsters: 107 Doctors, Nurses, and Medical Professionals Charged, 52 Others Suspended by HHS

May 3, 2012

Across the country yesterday, over 500 agents with the Medicare Fraud Strike Force were busy serving warrants, seizing documents, and clicking handcuffs in what DoJ has described as a “coordinated takedown involv[ing] the highest amount of false Medicare billings in a single takedown in strike force history.” 107 doctors, nurses, and other licensed medical professions were charged with alleged medicare fraud schemes totaling almost half a billion dollars. HHS also reports that it “suspended or took other administrative action against 52 providers.” Attorney General Holder condemned the alleged fraud and lauded the Strike Force efforts:

“The results we are announcing today are at the heart of an Administration-wide commitment to protecting American taxpayers from health care fraud, which can drive up costs and threaten the strength and integrity of our health care system. We are determined to bring to justice those who violate our laws and defraud the Medicare program for personal gain. As today’s takedown reflects, our ongoing fight against health care fraud has never been more coordinated and effective.”

HHS Secretary Kathleen Sebelius said that the arrests “send a strong message to criminals that the consequences of committing Medicare fraud are serious,” said HHS Secretary Sebelius. Charges range from health care fraud, conspiracy, and kickbacks to money laundering. While the alleged acts conceivably could have been charged under RICO or other more aggressive statutes, it appears that DoJ chose to take a more simple approach to prosecuting the arrested individuals. The majority of the alleged schemes involves service-based health care such as home health care fraud, physical therapy fraud, occupational thereby fraud, ambulance fraud, psychotherapy fraud, and mental health services fraud. Additionally, a significant portion of the charges relates to the supply of durable medical equipment (DME).

Court filings in the various cases reflect that “the defendants allegedly participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes never provided.” Additionally, “patient recruiters, Medicare beneficiaries and other co-conspirators were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could submit fraudulent billing to Medicare for services that were medically unnecessary or never provided.”

FBI Deputy Director Joyce pointed out how the victims of such fraud are not only the patients but also all Americans, as such fraud compromises our tenuous health care system and the fragile American economy. “Health care fraud is not a victimless crime,” said Joyce. “Every person who pays for health care benefits, every business that pays higher insurance costs to cover their employees, every taxpayer who funds Medicare—all are victims.”

The arrests involved high-level health care executives all the way down to low-level patient recruiters, “people up and down the chain of healthcare providers,” in the words of Assistant Attorney General Breuer.

While such news may seem shocking, it is becoming a fairly regular occurrence. This most recent bust is the fourth in a series of such medicare fraud roundups — and in some way or other each one has been bigger than the last. Either medicare fraud continues to grow at a startlingly rate or our enforcement efforts continue to improve. Most likely it is both.

To report health care fraud, contact Frohsin & Barger.

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