Medicare Fraud Sweep Nets $223 Million, 89 Arrests for False Billings

A nationwide takedown by Medicare Fraud Strike Force operations in eight cities has resulted in 89 arrests for alleged participation in Medicare fraud schemes involving $223 million in false billing, the Department of Health and Human Services (HHS) announced Wednesday.

The cumulative arrests represented the sixth national Medicare fraud takedown in the Strike Force’s history, which has netted almost 600 individuals charged in connection with schemes involving almost $2 billion in fraudulent billing practices.

The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS.


“Today’s announcement marks the latest step forward in our comprehensive efforts to combat fraud and abuse in our health-care systems,” stated Attorney General Eric Holder on Tuesday. “These significant actions build on the remarkable progress that the HEAT has enabled us to make—alongside key federal, state, and local partners—in identifying and shutting down fraud schemes.”

The 89 defendants charged are accused of various health care fraud-related crimes, including conspiracy to commit health care fraud, violations of the anti-kickback statutes and money laundering. 

Defendants also comprised a variety of healthcare segments involving home health care, mental health services, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and ambulance services. 


Approximately $44 million in false billings were uncovered for home health care, mental health services, physical and occupational therapy, DME and HIV infusion within the city of Miami alone. 

In one case noted by HHS, three defendants were charred for participating in a $20 million home health fraud scheme involving a home health agency, Trust Care Health Services.

Court documents allege that the defendants in this case brided Medicare beneficiaries for their Medicare information, which was used to bill for home health services that were not rendered or that were not medically necessary. 

Documents also note that the lead defendant in the case spend much of the money from the scheme on luxury vehicles, including two Lamborghinis, a Ferrari and a Bentley.

Other cases include 11 individuals charged by the Baton Rouge Strike Force in New Orleans for participating in a different, $51 million home health fraud scheme.

In this scheme, court documents allege the defendants recruited beneficiaries, offering cash and other incentives in exchange for their Medicare information, which was subsequently used to bill the federal program for medically unnecessary home health services. 

Also in New Orleans, another case nabbed six individuals with over $30 million in fraud in connection with a community mental health center called Shifa Texas. 

In Houston, two individuals, a nurse and a social work, were charged with fraudulently billing $8.1 million to Medicare for home health services.

On the west coast, 13 individuals were charged in Los Angeles for their roles in schemes to defraud Medicare of approximately $23 million, with one case involving three individuals who allegedly billed Medicare for more than $8.7 million for DME products such as power wheelchairs, which they sold to the defendants for illegal kickbacks.

The midwest also had its share of suspicious Medicare billing activity, notable in Detroit and Chicago. 

In Detroit, 18 defendants were charged for their roles in schemes involving approximately $49 million in false claims for medically unnecessary services, including home health, psychotherapy and infusion therapy. 

One case saw three individuals charged in a $12 million scheme where they allegedly held themselves out to be licensed physicians—which they were not, according to investigators—and signed prescription drugs and documents about purported psychotherapy they provided.

Chicago, on the other hand, saw seven individuals charged, including two doctors, with a variety of health care fraud schemes, which investigators did not mention in their announcement.

“Today’s takedown is the result of dedicated commitment to working with our law enforcement partners to root out fraud in the Medicare program,” stated CMS Program Integrity Deputy Administrator Peter Budetti. “This collaboration has been strengthened by the Affordable Care Act, which provides CMS with the tools it needs to stop the flow of money while working to rid our programs of fraud, waste, and abuse.”

Charges were also brought to numerous individuals in both Tampa and Brooklyn for a variety of schemes, ranging from pharmacy fraud health care-related money laundering, to unlicensed therapists filing false claims. In total, schemes in these states netted approximately $26.6 million.

“We all feel the effects of health care fraud,” stated FBI Assistant Director Ron Hosko, who assisted in the investigation. “It leads to higher health care costs and makes it harder for seniors and those who are ill to get the care they need. The FBI and our law enforcement partners are committed to preventing and prosecuting health care fraud at all levels.”

Written by Jason Oliva

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