In what the Justice Department is calling the largest takedown of healthcare fraud in U.S. history, federal authorities on Wednesday brought charges against 301 people for $900 million in false billings.
Among those charged includes 61 doctors, nurses, and other licensed medical professionals who, among other crimes, allegedly committed money laundering, identity theft, and Medicare Part D pharmacy fraud. Across the country, 23 states and 36 federal districts coordinated with the Justice Department and the Department of Health and Human Services to go after the alleged fraud schemes.
The defendants allegedly submitted Medicare and Medicaid claims the Justice Department said “were medically unnecessary and often never provided.” Some of the defendants were paid kickbacks for providing information for fraudulent bills. At least 28 doctors were among those charged on Wednesday. More from Atlantic.
Lynch/Justice Department: Good morning everyone and thank you all for being here. I am joined by several key leaders in our nation’s efforts to address health care fraud: Department of Health and Human Services Secretary [Sylvia] Burwell; Assistant Attorney General for the Criminal Division [Leslie] Caldwell; United States Attorney [Wifredo] Ferrer of the Southern District of Florida; FBI Associate Deputy Director [David] Bowdich; HHS Deputy Inspector General for Investigations [Gary] Cantrell; DCIS Acting Director [Dermot] O’Reilly; and [Shantanu] Agrawal, Deputy Administrator and Director of the Center for Program Integrity at the Centers for Medicare and Medicaid Services.
We are here today to announce a significant step in the federal government’s ongoing work to keep our nation’s health care system free of fraud and exploitation and to ensure that taxpayer dollars are used lawfully and appropriately. Over the last three days, the Medicare Fraud Strike Force – a joint effort between the Department of Justice and the Department of Health and Human Services – executed a significant nationwide health care fraud takedown. This action involved charging or unveiling charges against approximately 300 defendants in 36 federal districts for their alleged participation in a variety of schemes involving more than $900 million in fraudulent billings, making this the largest takedown in the Strike Force’s nine-year history.
The defendants named in these charges include doctors, nurses, pharmacists, physical therapists and home health care providers. They are accused of a wide range of serious crimes, from conspiring to commit health care fraud to making false statements and from bribery to money laundering. They submitted dishonest claims, charged excessive fees and prescribed unnecessary drugs. One group of defendants controlled a network of clinics in Brooklyn that they filled with patients through bribes and kickbacks. These patients then received medically unnecessary treatment, for which the clinic received over $38 million from Medicare and Medicaid – money that the conspirators subsequently laundered through more than 15 shell companies. In another case, a Detroit clinic billed Medicare for more than $36 million, even though it was actually a front for a narcotics diversion scheme. And yet another defendant took advantage of his position in a state agency in Georgia by accepting bribes and recommending the approval of unqualified health providers. These are just a few examples of the criminals that we targeted in this operation and although the specific nature of their wrongdoing varied from case to case, all of them betrayed the basic principles of their professions.
In addition to the usual patterns of fraud and deception that we’ve encountered in the past, we also saw new trends emerging in this year’s charges. For instance, in a number of cases involving the Medicare prescription drug benefit program known as Part D, we saw new evidence of identity theft, including the use of stolen doctors’ IDs to prepare fake prescriptions. We have also seen a growing number of cases involving compounded medications, which are combinations of two or more drugs prepared by a licensed professional. In recent years, the cost of these drugs has grown exponentially, making them a more attractive target for criminals looking to exploit them for profit.
As this takedown should make clear, health care fraud is not an abstract violation or benign offense. It is a serious crime. The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.
In tackling these challenges, the Medicare Fraud Strike Force relies on close cooperation between the federal, state and local, governments. Since 2014, the Justice Department’s Criminal Division has organized an annual National Health Care Fraud Training Conference for Assistant U.S. Attorneys and state and federal law enforcement officers, which has substantially expanded the reach of our actions. More than 20 non-Strike Force U.S. Attorney’s Offices participated in this year’s takedown, helping us to combat health care fraud in a total of 30 federal districts nationwide, from Alaska to Florida. We were also assisted by approximately 20 state Medicaid Fraud Control Units, a reflection of the close partnership between state and federal authorities in combatting health care fraud – a partnership that we will continue to strengthen in the days ahead.
I want to thank my colleagues in the FBI, the Criminal Division and U.S. Attorneys’ Offices for their ongoing efforts to combat health care fraud. I want to thank all of the state and local law enforcement officers across the country who participated in this complex and fast-moving takedown. And I look forward to continuing our work together in the days ahead.
At this time, I’d like to turn things over to Secretary Burwell, who has been a dedicated leader and indispensable partner in this critical work and who will provide additional details on today’s announcement.
