U.S. picks up 111 on Medicare fraud

WASHINGTON — The federal government’s Medicare Fraud Task Force filed criminal charges Thursday against doctors, nurses and health-care company executives - in all, 111 people in nine cities - in what was billed as the nation’s “largest-ever federal healthcare fraud takedown.”

The defendants, including five in Los Angeles and 11 in Chicago, are accused of cheating the government out of more than $225 million in falsebilling schemes that included fraudulent claims, kickback operations, money laundering and identity theft.

The sweep of arrests required more than 700 federal agents from the FBI and the Department of Health and Human Services to round up the suspects, plus serve an additional 16 search warrants around the country in connection with ongoing strike-force investigations.

“Our message is clear,” said assistant attorney general Lanny Breuer of the Justice Department’s Criminal Division. “We are determined to put Medicare fraudsters out of business.”

Daniel Levinson, Health and Human Services’ inspector general, said, “We will not tolerate criminals lining their pockets at the expense of Medicare patients and taxpayers.”

The task force was launched in March 2007, and since then 990 people have been charged in false-billing schemes totaling more than $2.3 billion, with nearly 750 of them already convicted in court. In addition, in 2010 alone the joint federal, state and local task force recovered an additional $4 billion in fines and other restitution payments on behalf of taxpayers that had been lost to corruption.

Those charged Thursday run the gamut of offenses. Some submitted claims to Medicare for treatments that were medically unnecessarily or never provided. Some recruited patients for hospitals and doctors’ offices, and then pocketed lucrative cash kickbacks.

Others set up phony schemes involving home health care, physical and occupational therapy, nerve conduction tests and prescription medicine. In one case, a podiatrist in Detroit purportedly billed the government for removing toenails that were never removed.

In Los Angeles, the five defendants are accused of scheming to defraud Medicare of more than $28 million in false claims for medical equipment and home health care. In Chicago, the 11 defendants were connected to businesses that purportedly billed Medicare more than $6 million for home health, diagnostic testing and prescription drugs.

Other arrests were in New York, Houston, Dallas, Miami, Tampa, Fla., and Baton Rouge.

Breuer said that as the task force has become increasingly more sophisticated, many of the new cases developed quickly, some in as few as two months. “We’re taking real data in real time and bringing the cases,” he said.

Attorney General Eric Holder said the typical prison sentence has been 43 months, a term he called “a pretty substantial hit.”

Holder saw an extra benefit in keeping the task force running. “After these cases are announced,” he said, “after these takedowns occur, we see pretty clearly substantial drops in the number of suspicious claims that are made. So I think the prosecution does have an important effect.”