Kusserow’s Corner: DOJ Reports Major “Take Down” by Medicare Fraud Strike Force


Over the last year, I have reported on this blog a number of cases investigated and prosecuted by the Department of Justice (DOJ) Medicare Fraud Strike Force. On May 13, the DOJ announced a major take down of scores of defendants that were arrested across the country for engaging in hundreds of millions of dollars in fraudulent bills to Medicare. The round-up included doctors, home health care providers, doctor’s assistants, pharmacy owners and medical supply company executives. The health care fraud charges included doctors billing for services that were never rendered, supply companies providing motorized wheelchairs that were never needed, recruiters paying kickbacks to get Medicare billing numbers of patients. The DOJ cited these cases as examples of widespread and rampant fraudulent activity that cut across every part of the Medicare system.

The latest crackdown included 90 defendants in Brooklyn, Tampa, Detroit, Houston, Los Angeles, and Miami that were charged with having submitted over $260 million in fraudulent claims to Medicare. At the center of this takedown reported were 27 medical professionals, including 16 physicians, who the DOJ alleges breached the public trust and their professional duties of care. As examples, the DOJ noted that in Houston, five doctors employed by a health care clinic were charged for being paid to provide $1.4 million worth of referrals for home health treatments that were not necessary and often not even provided. In Los Angeles, a physician with false billings for medically unnecessary home health and medical equipment orders that cost Medicare over $23 million—including hundreds of expensive power wheelchairs for people who did not need or want them. The DOJ noted that, in some of these schemes being reported, doctors went to extravagant lengths to conceal their fraud. This was the case in Detroit, where a doctor conspired with his billing company to conceal his false billings through a complex web of sham partnerships with other health care companies. In other schemes, the government seized extravagant fruits of the crimes, including bank accounts, jewelry, and luxury vehicles tied to the scheme.

The DOJ noted the investigations involved using cutting-edge, data-driven investigative techniques to find fraud. As an example, they noted that Medicare recently made physician billing data public for the first time, which has prompted a close look at who is billing Medicare for what. The Strike Force has been using numbers and other real-time data for years, provided by CMS to under sophisticated analysis to identify billing patterns that stand out compared to other health care providers in their communities. As a result, it has been able to identify billions of dollars in Medicare fraud, spread across the country. This real-time data has helped to pinpoint new schemes as they arise to stay one step ahead of the fraudsters. But, the DOJ stated that it is not just data that is making the cases. It also relies upon traditional law enforcement techniques to develop evidence, including use of undercover officers, Title III wiretaps, hidden cameras, and GPS trackers. Furthermore, the Strike Force has been aided by beneficiaries finding out what was billed to Medicare using their numbers and reporting irregularities to law enforcement.

Overall, since its inception, the DOJ’s Medicare Strike Force has charged nearly 1,900 individuals involved in approximately $6 billion of fraud. Their investigations and prosecutions range all across the spectrum of fraudulent actives—from the recruiters to the medical professionals to the owners of these clinics. The overall conviction rate reported from the Strike Force cases stands 95%.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2014 Strategic Management Services, LLC. Published with permission.