Jul 16, 2010 12:41 PM by Melissa Canone

Largest Medicare Fraud Bust Ever

MIAMI (AP) - Federal authorities said Friday they are conducting
the largest Medicare fraud bust ever in five different states and
arrested dozens of suspects accused in scams totaling $251 million.
Several doctors and nurses were among those arrested in Miami,
New York City, Detroit, Houston and Baton Rouge, La., accused of
billing Medicare for unnecessary equipment, physical therapy and
HIV treatments that patients typically never received. Ninety-four
suspects were indicted, and authorities said 36 people had been
arrested as of Friday morning.
More than 360 agents participated in Friday's raids, announced
by Attorney General Eric Holder and Health and Human Services
Secretary Kathleen Sebelius at a health care fraud prevention
summit in Miami. Officials said they chose Miami because it is
ground zero for Medicare fraud. Authorities indicted 33 suspects in
the Miami area, accused of charging Medicare for about $140 million
in various scams.
"With today's arrests we're putting would-be criminals on
notice: health care fraud is no longer a safe bet," Holder said
Cleaning up an estimated $60 billion to $90 billion a year in
Medicare fraud will be key to paying for President Barack Obama's
proposed health care overhaul. Federal officials have promised more
money and manpower to fight fraud, setting up strike forces in
several cities.
Around the country, the schemes have morphed from the typical
medical equipment scam in which clinic owners billed Medicare
dozens of times for the same wheelchair, while never giving the
medical equipment to patients. Now, officials say, the schemes
involve a sophisticated network of doctors, clinic owners, patients
and patient recruiters.
Violent criminals and mobsters are also tapping into the scams,
seeing Medicare fraud as more lucrative than dealing drugs and
having less severe criminal penalties, officials said.
For instance, agents bugged a medical center in Brooklyn, N.Y.,
where eight people are charged with running a $72 million scam that
submitted bogus claims for physical therapy for elderly Russian
immigrants. Clinic owners paid patients, including undercover
agents, in exchange for using their Medicare numbers and a bonus
fee for recruiting new patients. Recording devices captured
hundreds of kickback payments in a private room where a man sat at
a table and did nothing but pay patients all day, authorities said.
The so-called "kickback" room had a poster on the wall
resembling Soviet-era propaganda, showing a woman with a finger to
her lips and two messages in Russian: "Don't Gossip" and "Be on
the lookout: In these days, the walls talk."
With the surveillance, the walls "had ears and they had eyes,"
U.S. Attorney Loretta Lynch said at a news conference in Brooklyn.
In a separate Brooklyn case, authorities indicted six patients
who shopped their Medicare numbers to various clinics. More than
3,744 claims were submitted on behalf of one woman in the past six
years. The patients did not receive the services billed to
Medicare, authorities said.
"Today's arrests illustrate how health care fraud schemes can
replicate virally and migrate rapidly across communities," said
Daniel R. Levinson, inspector general of the U.S. Department of
Health and Human Services, which oversees Medicare.
Federal authorities launched a strike force in Miami in 2007 to
target the problem. The program has since expanded to seven cities
and is responsible for more than 720 indictments that collectively
have billed the Medicare program for more than $1.6 billion.
Miami-Dade County received about $520 million from Medicare in
home health care payments intended for the sickest patients in
2008, which is more than the rest of the country combined,
according to a federal report. Only 2 percent of the patients live
It used to take 90 days before the government detected a scam.
By then, the crooks were long gone, sometimes with millions of
dollars. Now authorities get billing data as it's submitted,
allowing them to catch suspects in real time, "as opposed to the
typical pay and chase model we've had for years," said Gerald Roy,
assistant inspector general for investigations.


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