Strike Force Ops Lead to Indictment of 30 Alleged Medicare Fraudsters

Thirty people have been charged in three cities for their alleged roles in schemes to submit more than $61 million in false Medicare claims as part of the continuing operation of the Medicare Fraud Strike Force, officials announced Dec. 15. Also on that day, the Departments of Justice and Health and Human Services announced the expansion of Strike Force operations to Brooklyn, N.Y.; Tampa, Fla.; and Baton Rouge, La. in the fifth, sixth, and seventh phases of a targeted criminal, civil, and administrative effort against individuals and health care companies that fraudulently bill the Medicare program.

Five indictments were unsealed Dec. 15 in Miami, Detroit, and Brooklyn, following the arrests of 25 individuals in Miami, four individuals in Detroit, and one in Brooklyn. In addition, Strike Force agents executed four search warrants at businesses and homes in Coconut Creek, Fla.; Miami; and Brooklyn.

The joint DOJ-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state, and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. Strike Force teams are operating in seven cities in the United States: Miami, Los Angeles, Detroit, Houston, Brooklyn, Tampa, and Baton Rouge.

"When President Obama took office, he promised a new commitment to cracking down on the criminals who steal billions of dollars from Medicare each year through fraudulent claims," said HHS Secretary Kathleen Sebelius. "Today, HHS and DOJ are following through on that commitment with the announcement of three new Medicare Fraud Strike Force teams in Baton Rouge, Tampa, and in Brooklyn. Along with teams already operating in Miami, Los Angeles, Houston, and Detroit, these Strike Force operations will allow us to concentrate our agents and resources on the criminal hubs where we know a significant share of fraud occurs. Medicare is a sacred promise to America's seniors, and we will do everything we can to protect it. The announcement we're making today is a significant step towards securing Medicare for seniors today and generations to come."

Assistant Attorney General Lanny A. Breuer of the DOJ Criminal Division added that "Medicare fraud schemes are driven by greed -- pure and simple. The people who perpetrate these crimes rob Medicare of precious dollars by fraudulently billing for made-up or unnecessary services. In Miami, Los Angeles, Detroit, and Houston, the Medicare Fraud Strike Force is making significant progress against these schemes. Through the Strike Force's proven data analysis, we are now also identifying and prosecuting the worst offenders in Brooklyn, Tampa, and Baton Rouge, and we will continue to rid these communities of Medicare fraudsters."

According to DOJ, the Strike Force operations in Brooklyn, Tampa, and Baton Rouge are another important step of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between DOJ and HHS to focus their joint efforts to reduce and prevent Medicare and Medicaid fraud through enhanced cooperation. The HEAT taskforce is made up of top-level law enforcement agents, prosecutors, and staff from both departments and their operating divisions. In the May 2009 announcement, Attorney General Eric Holder and Sebelius announced the expansion of the Strike Force into Detroit and Houston to build upon existing partnerships between the agencies in a heightened effort to reduce fraud and recover taxpayer dollars.

Individuals charged in indictments announced Dec. 15 are accused of various Medicare fraud crimes, including conspiracy to defraud the Medicare program, conspiracy to launder money, money laundering, criminal false claims, making false statements, and receiving kickbacks.

According to charging documents, the defendants participated in schemes to submit claims to Medicare for products and services that were in fact medically unnecessary and, oftentimes, never provided. In the Detroit cases, defendants are alleged to have participated in a scheme whereby they paid kickbacks to patients who received instructions from the clinic owners and patient recruiters to feign symptoms to justify expensive testing, including nerve conduction studies. In Brooklyn, the two defendants are alleged to have billed Medicare for durable medical equipment, including expensive shoe inserts reserved for diabetes patients, when in fact much cheaper and over-the-counter shoe inserts were provided to beneficiaries who often didn’t need them. In Miami, 15 individuals, including doctors and nurses, are charged in connection with fraudulent claims to Medicare for home health services. In another case in Miami, individuals are charged for their various roles in running a medical clinic that purported to provide injection and infusion treatments to HIV/AIDS patients and submitted fraudulent claims to Medicare for such services, which were often medically unnecessary and/or never provided.

Collectively, the physicians, company owners, executives, and others charged in the indictments are accused of conspiring to submit approximately $61 million in false claims to the Medicare program.

"We will continue to dedicate the resources necessary to root out the fraud and bring those perpetrating it to justice," said Kevin Perkins, Assistant Director of the FBI's Criminal Investigative Division. "This type of fraud is not victimless -- we are all victims when our health care system is defrauded."

Since the inception of Strike Force operations in March 2007 -- in Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three), Houston (Phase Four), and Brooklyn (Phase Five) -- the Strike Force has obtained indictments of more than 460 individuals and organizations that collectively have falsely billed the Medicare program for more than $1 billion. In addition, HHS's Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, said it is taking steps to increase accountability and decrease the presence of fraudulent providers.

Each of the Strike Force teams is led by a federal prosecutor from the respective U.S. Attorneys' Office or the Criminal Division's Fraud Section, and each team has an agent from the FBI and HHS-OIG.

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