Feds Step Up Fight Against Medicare Fraud

Earlier this month, the federal Medicare Fraud Strike Force charged more than 100 people for their roles in an alleged $452 million false billing scheme. It was an important victory for authorities, and reflects the Obama administration’s increased efforts to combat fraud in the Medicare program.

The latest arrests are part of broader effort to prosecute doctors, nurses, and other medical professionals engaged in fraudulent health care services.

What types of illegal activities are federal investigators targeting? Here are five:

1. Payment of bribes and kickbacks:

“[Judith] Negron and her co-defendants had masterminded a scheme that defrauded Medicare for more than eight years. The scheme operated by paying bribes and kickbacks to the owners and operators of assisted elderly care facilities across Florida in exchange for delivering Medicare-ineligible patients to Negron’s company. The fraudulent clinic paid millions of dollars in kickbacks, and defrauded Medicare for more than $205 million of unnecessary or illegitimate services. After a six-day trial in August of 2011, Negron was found guilty of 24 felony counts, including several health care fraud offenses and money laundering offenses.” (Medicare Fraud Scheme Results In Longest Health Care Fraud Sentences In History by Warner Norcross & Judd)

2. Billing for services not provided:

“Prosecutors said that Duran and his co-defendants billed Medicare for hundreds of millions of dollars in mental-health services that were either unnecessary or never provided. Prosecutors also said that Duran forged patient files for mentally ill people to make them seem eligible for sleep studies that they would not actually participate in, while American Therapeutic would pay kickbacks to recruiters to supply patients suffering from Alzheimer’s disease and similar conditions. Duran admitted that the patients could not have benefited from the company’s services.” (Judge Imposes Draconian Sentences in Medicare Fraud Scheme by Ifrah Law)

3. Billing for unneeded and unnecessary care:

“Last month, the Federal Medicare Strike Force charged 111 defendants in nine states for their alleged participation in fraud schemes that reportedly cost Medicare almost a quarter billion dollars… The schemes targeted by the Strike Force involved patient recruiters, who sought out Medicare beneficiaries who were willing to provide their Social Security Numbers and Medicare information. Recruiters allegedly induced beneficiaries to disclose their personal information with promises of free medical services or durable medical equipment. Healthcare professionals then used the data to bill for services or equipment that were not medically necessary…” (Strike Force Hits Hard at Massive Medicare Fraud by Ifrah Law)

4. Wire fraud:

“The case brought against Patrick Ita is a good example of the ease with which the government can charge – and convict – a defendant of wire fraud in the health care context. In September 2011, Mr. Ita was sentenced to 78 months in federal prison, followed by three years of supervised release, after pleading guilty to charges that he engaged in a conspiracy to defraud Medicare of more than $5 million and also committed wire fraud. These criminal charges stemmed from a 13-month scheme through which Mr. Ita billed Medicare using a specific code created by Medicare to expedite the approval and payment of claims for durable medical equipment (DME) lost or destroyed by Hurricanes Katrina and Rita.” (Industry Trends in Criminal Health Care Fraud Enforcement — Part III in a Continuing Series on Health Care Enforcement by Mintz Levin)

5. Money laundering:

“The types of providers targeted in the takedown ranged widely, as did the industries in which they practiced. In addition, the defendants were accused of various crimes, including … money laundering. Notably, many of the individuals charged provided services in industries that have received considerable government attention in recent years, including home health care and durable medical equipment. The defendants were also charged under statutes used by the government with increasing frequency in its prosecution of health care fraud.” (Medicare Fraud Strike Force Bust Involves Highest Amount of False Billings in a Single Takedown by Mintz Levin)

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