Gotcha! Feds Bust 243 Fraudsters for Stealing $712 Million from Medicare
Policy + Politics

Gotcha! Feds Bust 243 Fraudsters for Stealing $712 Million from Medicare


In what Attorney General Loretta Lynch called the largest nationwide crackdown on health care fraud, the Justice Department said Thursday that 243 people had been arrested and charged with allegedly billing Medicare falsely for approximately $712 million.

The charges range from conspiracy to commit health care fraud to money laundering and identity theft. The defendants seemed to target every vulnerable area of Medicare they could think of, including home health care, health care, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and pharmacy fraud. 

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Lynch, who in a short time has proven herself a no-nonsense doer, said, “This action represents the largest criminal health care fraud takedown in the history of the Department of Justice.”

“The defendants charged include doctors, patient recruiters, home health care providers, pharmacy owners, and others. They billed for equipment that wasn’t provided, for care that wasn’t needed, and for services that weren’t rendered…. We are prepared – and I am personally determined – to continue working with our federal, state, and local partners to bring about the vital progress that all Americans deserve,” she said.

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This isn’t the first time Medicare has been targeted by unscrupulous health care professionals.

  • A series of hearings in March of 2011, experts told Congress that the government could save as much as $70 billion a year by cracking down on fraud.
  • In April 2014, HHS released a massive database that revealed how the agency spent their $500 annual budget. One item that stuck out like a very sore thumb: $26 million in Medicare payments to one provider — an ophthalmologist in West Palm Beach, Fla. (That’s nearly 61 times more than what Medicare paid the average ophthalmologist.)
  • Whether they needed them or not, fraudsters were able to give power wheelchairs to people who never needed them costing Medicare billions of dollars. The scam was first reported by The Washington Post.

  • Just last month, Reuters reported that doctors who had been banned by Medicare were still cashing in from Medicaid, which wasted $14.4 billion in improper payments in 2013 alone.

  • More than 2,300 Medicare doctors earned $500,000 in 2013 by practicing a single procedure and overbilling for that procedure.

The list is endless, partly because of improper payments, which are difficult to track in some cases—let alone prove. The idea is to stop the fraud at the outset, as soon as the bill comes through. Burwell said, “With increased resources that have allowed the Strike Force to expand and new tools, like enhanced screening and enrollment requirements, tough new rules and sentences for criminals, and advanced predictive modeling technology, we have managed to better find and fight fraud as well as stop it before it starts.”

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According to court documents, the defendants participated in alleged schemes to submit claims to Medicare and Medicaid for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, Medicare beneficiaries and other co-conspirators allegedly were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of conspiring to submit a total of approximately $712 million in fraudulent billing.

The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since their inception in March 2007, Strike Force operations in nine locations have charged over 2,300 defendants who collectively have falsely billed the Medicare program for over $7 billion. 

Including today’s enforcement actions, nearly 900 individuals have been charged in national takedown operations, which have involved more than $2.5 billion in fraudulent billings. Since 2007, federal authorities have charged more than 2,300 people for fake Medicare billings totaling more than $7 billion.

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