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Feds Charge 300 in Nation's Largest Health Care Fraud Bust

by Pete Williams /  / Updated 
U.S. Attorney General Loretta Lynch addresses a convening on Women and the Criminal Justice System at The White House.The White House

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Federal authorities said Wednesday that roughly 300 people in more than half the states have been charged in the largest crackdown to date on health care fraud.

Those arrested account for more than $900 million in false billings to Medicare and Medicaid, according to the Departments of Justice and Health and Human Services.

Among those arrested are 60 licensed medical professionals, including 30 doctors, officials said.

The billings were for treatments or services deemed medically unnecessary — or for services that were never provided at all, including home care, medical equipment, and phony prescriptions.

Related: Hacking of Health Care Records Skyrockets

In one cases in the roundup, authorities say, five people were arrested in Brooklyn, accused of cheating Medicare and Medicaid in an $86 million scam in which they paid kickbacks to patients who then received unnecessary physical and occupational therapy.

The five are accused of funneling more than $38 million worth of reimbursements on the $86 million in bills through several New York shell companies that purported to provide consulting, marketing and advertising services but were actually intended to hide the money from the IRS and avoid taxes. Among those charged were a licensed occupational therapist and a licensed physical therapist.

"These takedowns protect and deter fraud in programs that millions of people rely on, sending a strong signal that theft from these taxpayer-funded programs will not be tolerated," said one federal official involved in the operation.

Attorney General Loretta Lynch and HHS Secretary Sylvia Mathews Burwell joined other federal officials to discuss the crackdown during a press conference on Wednesday.

Related: Feds Charge 243 People with Medicare Fraud

"As this takedown should make clear, health care fraud is not an abstract violation or benign offense. It is a serious crime. The wrongdoers that we pursue in these operations seek to use public funds for private enrichment," Lynch said. "They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust — between doctor and patient; between pharmacist and doctor; between taxpayer and government — and pervert them to their own ends."

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