Strike Force Charges 90 in Six Cities With Defrauding Medicare of $260 Million

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By James Swann  

May 13 — The Departments of Justice and Health and Human Services May 13 announced charges against 90 individuals in six cities, claiming they participated in Medicare fraud schemes that led to roughly $260 million in fraudulent billing.

The announcement was the result of investigations by Medicare Fraud Strike Force teams, and the 90 individuals included 27 doctors and other health-care professionals.

“The crimes charged represent the face of health care fraud today—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,” acting Assistant Attorney General David A. O'Neil said during a May 13 press conference.

A little more than half of the individuals charged (50) were from Miami. They were charged with participating in Medicare fraud schemes that led to $66 million in false billings, according to the announcement.

The remaining 40 charged individuals were from Houston (11); Los Angeles (eight); Detroit (seven); Tampa, Fla. (seven); and Brooklyn, N.Y. (seven).

The Medicare Fraud Strike Force program was created in 2007 and is currently operational in Chicago; Dallas; Miami; Los Angeles; Detroit; Houston; Baton Rouge, La.; Brooklyn; and Tampa.

Defrauding Medicare

Fraud schemes identified by Strike Force investigations including billing for medically unnecessary services and paying kickbacks to a pharmacy to obtain Medicare beneficiary information, according to the DOJ and HHS announcement.

For example, five doctors in the Houston area were charged with billing Medicare for medically unnecessary home health services. The doctors would sign for home health services that were either not medically necessary or were never provided to patients.

In another case, five individuals in Tampa were charged with both health-care fraud and money laundering that cost Medicare $12 million, the announcement said.

The fraud scheme involved using Medicare beneficiary names from Miami to bill for services provided in Tampa. Once Medicare paid for the services, the money was then laundered through various shell organizations, the agencies said.

As for kickbacks, two individuals in Miami were charged with receiving kickbacks from a pharmacy as part of a $23 million fraud scheme. The kickbacks were received in return for providing Medicare beneficiary information, which was then used to bill Medicare for drugs that were never provided.

The two individuals laundered their kickbacks in shell organizations they controlled, the DOJ and HHS announcement said.

`Be Aware of Fraud.'

Speaking at the May 13 press conference, Joseph Campbell, assistant director at the Federal Bureau of Investigation, said individuals should be alert for signs of health-care fraud.

“Take the time to be aware of fraud and call law enforcement if you see anything suspicious, included in the billings to your insurance, Medicare, or Medicaid or have any unusual encounters with health-care providers,” Campbell said.

All of the announced charges are being prosecuted by Strike Force teams, which include attorneys from the DOJ and the U.S. Attorney's Office, as well as agents from the FBI, the HHS Office of Inspector General and state Medicaid Fraud Control Units.

Senators to Introduce Anti-Fraud Bill

A bipartisan group of senators May 13 said they were pleased with the work of the Strike Force in targeting health-care fraud but said legislation is needed to help combat Medicare fraud.

Special Committee on Aging Chairman Bill Nelson (D-Fla.) and ranking member Susan Collins (R-Maine), along with Sens. Thomas R. Carper (D-Del.) and Charles E. Grassley (R-Iowa), plan to introduce the Stop SCAMS ACT OF 2014 on May 15, according to an announcement. The legislation would let private insurers share information about potentially fraudulent providers with Medicare, as well as require Medicare to check if any providers or suppliers enrolling in Medicare have previously owned companies that have defrauded the government.

Grassley said the bill would be similar to the Physician Payment Sunshine Act.

“It requires HHS to use available data, including data from the Sunshine Act, to verify doctors' reported information about ownership interests in organizations that bill Medicare,” Grassley said in a May 13 statement.

Carper said the bill “is an important step in combating Medicare fraud and preserving this essential program for the future generations.”

To contact the reporter on this story: James Swann in Washington at

To contact the editor responsible for this story: Ward Pimley at

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