More than 400 people across the country have been charged in connection with $1.3 billion in healthcare fraud losses as part of what the federal government has labeled the largest enforcement action of its kind in U.S. Department of Justice (DOJ) history.

United States Attorney General Jeff Sessions and U.S. Department of Health and Human Services (HHS) Secretary Tom Price made the joint announcement on Thursday, declaring that the defendants were charged across 41 federal districts and included 115 doctors, nurses, and other licensed medical professionals. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses, and pharmacists, barring them from continued participation in federal healthcare programs.

“The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries,” the DOJ said in a press release. “The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department.”

The New York Times reported last month that more than 59,000 people were estimated to have died due to a drug overdose in 2016, marking the largest such figure since reliable records started being kept around 1980. That figure also eclipsed the contemporary American single-year death-toll records for car accidents, gunshot wounds, and even the HIV/AIDS epidemic of the 1980s and 1990s.

“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients. Amazingly, some have made their practices into multimillion dollar criminal enterprises, (and) they seem oblivious to the disastrous consequences of their greed,” Sessions said in a statement. “Their actions not only enrich themselves often at the expense of taxpayers, but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department’s work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”

“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars – it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” Price added. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud.”

In many cases, the DOJ said, patient recruiters, beneficiaries, and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed.

“The number of medical professionals charged is particularly significant, because virtually every healthcare fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims,” the DOJ’s press release read. “Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.”

The federal government’s enforcement actions in this matter were coordinated by the DOJ’s Criminal Division Fraud Section’s Health Care Fraud Unit, in conjunction with its Medicare Fraud Strike Force (MFSF) members: this constitutes a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI, and the HHS Office of Inspector General (OIG). In addition, the operation included the participation of the DEA, Defense Criminal Investigative Service (DCIS), and State Medicaid Fraud Control Units. The Medicare Fraud Strike Force operates in nine locations nationwide, and since its inception in March 2007, it has charged more than 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.

The DOJ announced that this week’s enforcement efforts included the following:

  • In the Southern District of Florida, a total of 77 defendants were charged with offenses relating to their alleged participation in various fraud schemes involving over $141 million in false billings for services including home health care, mental health services, and pharmacy services. In one case, the owner and operator of a purported addiction treatment center and home for recovering addicts and one other individual were charged in a scheme involving the submission of more than $58 million in fraudulent medical insurance claims for purported drug treatment services. The defendants allegedly recruited addicted patients to move to South Florida so that the co-conspirators could bill insurance companies for fraudulent treatment and testing, in return for which the co-conspirators offered kickbacks to patients in the form of gift cards, free airline travel, trips to casinos and strip clubs, and drugs.
  • In the Eastern District of Michigan, 32 defendants face charges for their alleged roles in fraud, kickback, money laundering, and drug diversion schemes involving approximately $218 million in false claims for services that were medically unnecessary or never rendered. In one case, nine defendants, including six physicians, were charged with prescribing medically unnecessary controlled substances, some of which were sold on the street, and billing Medicare for $164 million in facet joint injections, drug testing, and other procedures that were medically unnecessary and/or not provided.
  • In the Southern District of Texas, 26 individuals were charged in cases involving over $66 million in alleged fraud. Among these defendants are a physician and a clinic owner who were indicted for conspiracy and other charges in connection with their roles with a purported pain management clinic that is alleged to have been the highest-prescribing hydrocodone clinic in Houston, where approximately 60-70 people were seen daily. These defendants allegedly were issued medically unnecessary prescriptions for hydrocodone in exchange for approximately $300 cash per visit.
  • In the Central District of California, 17 defendants were charged for their roles in schemes to defraud Medicare out of approximately $147 million. Two of these defendants were indicted for their alleged involvement in a $41.5 million scheme to defraud Medicare and a private insurer. This was purportedly done by submitting fraudulent claims and receiving payments for prescription drugs that were not ordered by the pharmacy nor given to patients.
  • In the Northern District of Illinois, 15 individuals were charged in cases related to six different schemes concerning home health care services and physical therapy fraud, kickbacks, and mail and wire fraud. These schemes involved allegedly over $12.7 million in fraudulent billing. One case allegedly involved $7 million in fraudulent billing to Medicare for home health services that were not necessary nor rendered.
  • In the Middle District of Florida, 10 individuals were charged with participating in a variety of schemes involving almost $14 million in fraudulent billing. In one case, three defendants were charged in a $4 million scheme to defraud the TRICARE program. In that case, it is alleged that a defendant falsely represented himself to be a retired Lieutenant Commander of the United States Navy Submarine Service. It is alleged that he did so in order to gain the trust and personal identifying information from TRICARE beneficiaries, many of whom were members and veterans of the armed forces, for use in the scheme.
  • In the Eastern District of New York, 10 individuals were charged with participating in a variety of schemes including kickbacks, services not rendered, and money laundering involving over $151 million in fraudulent billings to Medicare and Medicaid. Approximately $100 million of those fraudulent billings were allegedly part of a scheme in which five healthcare professionals paid illegal kickbacks in exchange for patient referrals to their own clinics.
  • In the Southern Louisiana Strike Force, seven defendants were charged in connection with healthcare fraud, wire fraud, and kickback schemes involving more than $207 million in fraudulent billing. One case involved a pharmacist who was charged with submitting and causing the submission of $192 million in false and fraudulent claims to TRICARE and other healthcare benefit programs for dispensing compounded medications that were not medically necessary and often based on prescriptions induced by illegal kickback payments.

In addition to the Strike Force locations, the enforcement actions include investigations brought by an additional 31 state U.S. Attorney’s Offices, which are individually prosecuting the cases along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section.

Along with Sessions and Price, also participating in Thursday’s announcement were  Acting Assistant Attorney General Kenneth A. Blanco of the DOJ’s Criminal Division, Acting Director Andrew McCabe of the FBI, Acting Administrator Chuck Rosenberg of the Drug Enforcement Administration (DEA), Inspector General Daniel Levinson of the HHS OIG, Chief Don Fort of IRS Criminal Investigation, Administrator Seema Verma of the Centers for Medicare & Medicaid Services (CMS), and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).

“This week, thanks to the work of dedicated investigators and analysts, we arrested once-trusted doctors, pharmacists, and other medical professionals who were corrupted by greed,” McCabe said. “The FBI is committed to working with our partners on the front lines of the fight against healthcare fraud to stop those who steal from the government and deceive the American public.”

“Healthcare fraud is a reprehensible crime. It not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid,” Levinson added. “In the worst fraud cases, greed overpowers care, putting patients’ health at risk. OIG will continue to play a vital leadership role in the Medicare Fraud Strike Force to track down those who abuse important federal health care programs.”

 “The desire for money and material items drove these individuals to perpetrate crimes against our healthcare system and prey upon many of the vulnerable in our society,” Fort said. “Thanks to the financial expertise and diligence of IRS-CI special agents, who worked side-by-side with other federal, state, and local law enforcement officers to uncover these schemes, these criminals are off the street and will now face the consequences of their actions.”

To read the DOJ press release in its entirety, or for more information on the individual charges being made available shortly via a link included therein, go online to


Mary A. Inman, Esq. will report on this story during the next edition of Monitor Monday, July 17, 2017, 10-10:30 a.m. ET.

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