Federal authorities in Detroit have arrested nine people and are seeking two others as part of a nationwide Medicare fraud bust. Federal authorities said 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 Detroit, Miami, New York City, 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 Friday.
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 $50 million scam that submitted bogus claims for physical therapy. 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.
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 here.
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.
(Copyright 2010 WWJ. All Rights Reserved. The Associated Press contributed to this report)