Over 240 Arrests By The FBI For Largest Medicare Fraud Bust In History

On June 18, 2015, Attorney General Loretta E. Lynch and Department of Health and Human Services (“HHS”) Secretary Sylvia Mathews Burwell, accompanied by FBI Director James B. Comey and members of the Department of Justice (“DOJ”), announced the largest Medicare fraud bust in history. This bust ended with 243 individuals, including 46 licensed medical professionals, being arrested for their participation in a Medicare fraud scheme that involved roughly $712 million in false billings. Initiated by the Medicare Fraud Strike Force, which is composed of individuals from the DOJ, the HHS, the FBI, and local law enforcement, a nationwide sweep of 17 different districts lead to these arrests. Of these districts, the three highest arrests took place in Miami (30%), Houston (9%), and Detroit (7%).

The arrests began on Tuesday, June 16. According to Attorney General Lynch, the individuals arrested “billed for equipment that wasn’t provided, for care that wasn’t needed, and for services that weren’t rendered.” These defendants are being charged with conspiracy to commit health care fraud, violations of the Anti-Kickback Statute (42 U.S.C. § 1320a-7b), money laundering, and aggravated identity theft. The alleged violation of the Anti-Kickback Statute is due to beneficiaries and co-conspirators paying kickbacks for providing beneficiary information to them so that false claims could be submitted. Additionally, roughly 20% of the defendants were charged with fraud related to Medicare Part D, which is the prescription drug benefit program.

The Medicare Fraud Strike Force was created in 2007 in order fight healthcare abuse, fraud, and waste. Since that time, the Strike Force has arrested well over 2,000 individuals charged for falsely billing Medicare in excess of $7 billion. This takedown emphasizes the DOJ’s and HHS’s commitment to stopping health care fraud. As HHS Secretary Burwell stated, “We will not stop here. We will work tirelessly to prevent these programs from becoming targets and fight fraud wherever we wind it.”

With the presence of the largest Medicare fraud bust in history, healthcare providers and facilities must ensure that any arrangement where there exists a potential for referrals fits within an Anti-Kickback Statute safe harbor. Furthermore, providers and facilities need to ensure that they are following all healthcare laws so that they do not find themselves the subject of a Medicare Fraud Strike Force operation. If you have questions regarding the recent Medicare fraud sting, the Anti-Kickback Statute generally, or other questions regarding your practice or facility, please do not hesitate to contact Briar Siljander or Jennifer Gross at 810-227-3103.

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