DOJ Charges Nearly 80 People In $2.5 Billion Health Care Fraud Scheme

The Department of Justice (DOJ) announced Wednesday it has charged 78 people relating to their alleged involvement in defrauding care programs for elderly and disabled people of more than $2.5 billion.

Among the charges filed against the accused are allegations of telemedicine fraud, pharmaceutical fraud and accusations of opioid distribution. Many of the defendants obtained their funds by making fraudulent claims for Medicare reimbursement, often for items that were ineligible.

“These enforcement actions, including against one of the largest health care fraud schemes ever prosecuted by the Justice Department, represent our intensified efforts to combat fraud and prosecute the individuals who profit from it,” Attorney General Merrick Garland said in a statement.

Authorities in California, Florida, Georgia, Indiana, Kentucky, Louisiana, Michigan, New Jersey, New York, Ohio, Pennsylvania, South Carolina, Texas, Washington and Wisconsin are prosecuting the cases.

The identified defendants include a California chiropractor and acupuncturist; a New York resident who owned and operated eight durable medical equipment companies; and a Brooklyn-based medical assistant.

In some cases, the defendants are alleged to have used the funds to purchase “exotic automobiles, jewelry, and yachts.”

The bulk of the fraud appears to have been conducted through telemedicine schemes. According to the DOJ, individuals in the U.S. and abroad engaged in an operation that targeted elderly and disabled people through advertisements and the mail, connecting them with offshore staff who upsold unnecessary equipment and prescriptions.

These included “orthotic braces, prescription skin creams, and other items that were medically unnecessary and ineligible for Medicare reimbursement.”

A software program was used by the telemarketers for kickbacks and bribes to telemedicine companies in exchange for doctors’ orders for Medicare beneficiaries, according to the indictment that came from the Southern District of Florida

This operation allegedly resulted in $2 billion is false and fraudulent claims to Medicare and other government insurance programs.

A group of 10 other defendants were charged with fraud in a scheme to obtain and distribute prescription medicines. In one case, a pharmaceutical wholesale distribution company is accused of purchasing illegally diverted HIV medication. These medicines were obtained by paying HIV patients with cash.

The company allegedly falsified documents to make it seem as though the drugs were obtained legitimately and repackaging them. Pharmacies then sold the drugs and billed health care benefit programs.

“Patients trust federal health care programs to provide high quality care. When bad actors steal from these programs, they hurt patients,” said Christi A. Grimm, inspector general for the Department of Health and Human Services.


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