US health fraud stings net 301 people this year, most ever

June 22, 2016

The U.S. charged 301 people this year in a series of medical fraud sting operations, the most ever, for allegedly running scams that bilked the government out of $900 million.

Takedowns so far this year have involved medical clinics, home health care services and shell companies that submitted fraudulent Medicare and Medicaid claims for tens of millions of dollars at a time, Attorney General Loretta Lynch, Department of Health and Human Services Secretary Sylvia Mathews Burwell and other U.S. officials announced Wednesday.

In one example, three individuals were indicted for operating clinics that gave drug addicts prescriptions for controlled substances and narcotics and then billed Medicare for $36 million in fraudulent claims for services that were never provided.

“Health care fraud is not an abstract violation or benign offense. It is a serious crime,” Lynch told reporters in Washington. “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.”

The takedowns represent continuing efforts by U.S. officials to combat health care fraud costing the government billions. More than 1,200 individuals have been charged in national operations, which have involved more than $3.4 billion in fraudulent billings, according to Justice Department data going back to July 2010.

Last June, the Justice Department charged 243 people, including 46 doctors, nurses and other medical professionals, with defrauding the Medicare system of $712 million through false billing.

Charges have been brought against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, the departments said. The Justice Department posted about 50 indictments or complaints on its website.

The three individuals who were indicted for operating clinics that gave drugs to addicts would provide bribes in the forms of cash, prescriptions for controlled substances and gym access to patients who provided their medical billing information in order to make fraudulent Medicare claims, according to one indictment.

"This is an example of how purported health care providers prey upon and compound the drug addictions of Medicare beneficiaries in order to steal more money from the Medicare program," according to a statement from the Justice Department.

In another case, five persons who managed and controlled a network of clinics in Brooklyn, New York, were indicted on various charges, including conspiracy to commit money laundering, money laundering and conspiracy to receive and pay health-care kickbacks.

The clinics were allegedly filled with patients by paying bribes and kickbacks, including to Brooklyn-area ambulance drivers who provided people who were then subjected to medically unnecessary treatment, the Justice Department said. The clinic received more than $38 million from Medicare and Medicaid, Lynch said. The operators allegedly used more than 15 different shell companies to launder and hid proceeds from their fraud, she said.

"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," Lynch said.


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