Federal and state enforcement officials charged 301 doctors, nurses and other licensed medical professionals across the country with healthcare fraud Wednesday in what the U.S. Justice Department described as the largest coordinated takedown in history.
The alleged schemes cost the government about $900 million, according to the Justice Department.
“As this takedown should make clear, healthcare fraud is not an abstract violation or benign offense; it is a serious crime,” U.S. Attorney General Loretta Lynch said in a statement. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people, many of them in need of significant medical care."
Those implicated face criminal and civil charges for a variety of alleged misdeeds, including conspiracy to commit healthcare fraud, violations of the anti-kickback statutes, money laundering and identity theft. The alleged fraud involves home healthcare, psychotherapy, physician and occupational therapy, durable medical equipment and prescription drugs.
Among the 301 individuals caught up in the takedown Wednesday, 61 were doctors. More than 60 of those arrested were charged with fraud related to Medicare Part D, Medicare's drug benefit program. Federal enforcers have, in recent years, ramped up their battle against fraud involving Medicare Part D, which was implemented in 2006.
Dan Olson, a senior manager with Deloitte & Touche and a certified fraud examiner, called the takedown “encouraging” and said it could deter others from committing such crimes. He said, however, it’s important not to forget that the overall problem of healthcare fraud is getting worse, not better. Government benefit programs made total improper payments of $137 billion in 2015 compared with $38 million in 2005, according to a recent Deloitte report.
“We need to get to prevention,” Olson said. “We need to stay two steps ahead of where the fraudster is and anticipate those emerging trends.” Deloitte’s recent report recommended the government battle fraud by focusing on data collection, emphasizing prevention and sharing intelligence, among other ideas.
The arrests Wednesday came almost exactly a year after federal officials announced the results of a similar coordinated enforcement effort. Last June, the Justice Department announced what was then the largest coordinated, criminal Medicare fraud bust. As part of that effort, the Medicare Fraud Strike Force revealed charges against 243 individuals across the country accused of falsely billing $712 million to Medicare in a number of separate schemes.
In that bust, more than 44 of those arrested were charged with fraud related to Medicare Part D. That constituted the first large-scale effort to focus on Medicare Part D fraud.
At the time, some criticized the Justice Department announcement, saying it was little-more than a roundup of individual cases meant to grab media attention and act as a deterrent to would-be offenders.
The announcement Wednesday drew similar reactions from some. Mark Silberman, a partner at law firm Duane Morris who represents providers, said he understands the value of drawing attention to healthcare fraud to deter it, but he questioned the Justice Department's tactics.
“What they're doing is taking a whole bunch of unrelated cases, holding them back and doing it so as to make a splash to draw attention,” Silberman said. “How much does this enable health fraud to continue while they amass the group?”
