Houston Texas Business Lawyer

Charges Filed in Largest Ever Criminal Medicare Fraud Case

Three individuals were recently charged by the U.S. Justice Department for perpetrating the largest ever criminal health-care fraud case. While Medicaid fraud and Medicare fraud are very common and happen every day, this case was a unique one because of the sheer size and scope of the fraud that occurred. The Wall Street Journal reported on the troubling story of how three people bilked a program out of billions of dollars that should have gone towards providing healthcare for seniors and the disabled. medic-calming-down-wounded-person-1311368

According to the Wall Street Journal, the three participants in this record-setting fraud scheme included a hospital administrator, a healthcare operator, and a physician's assistant. The healthcare operator was the owner of more than 30 nursing homes and assisted living facilities. The scheme involved thousands of patients being referred to the assisted living facilities and nursing homes of the healthcare operator, even though they technically should not have qualified under Medicare's coverage rules.

Once the patient had been moved onto one of the nursing homes or assisted living facilities, Medicare was billed for services that were either provided but not needed, or that were never even provided at all. Once the limits on coverage had been reached and Medicare would no longer pay for the services in that particular facility, the patient was simply moved to a different location. The entire scam would begin all over again, with Medicare once again being billed for services. Those who were involved in the illegal referrals and billings then received kickbacks, which were either paid under the table in cash or which were disguised as charitable contributions.

The conspiracy between the three individuals took place over a period of more than 14 years. The Medicare Fraud Strike Force (MFSF), which began investigating Medicare fraud in 2007, was eventually able to discover what was going on. The individuals who were involved with operating the scam have now been charged with a variety of serious offenses including money laundering, illegal kickbacks, conspiracy to defraud the United States government, and a variety of other serious offenses. If convicted, the ring-leader of the scam who owns all of the different nursing home facilities could potentially face penalties up to life imprisonment.

While this scheme is believed to be the largest fraud perpetrated by a single group of co-conspirators on Medicare, unfortunately fraud happens every day both within the Medicare program and within the Medicaid program.  Often, this fraud does not come to light for many years, during which time taxpayers end up losing out on substantial sums of money. Investigating each incident of Medicaid fraud can be resource intensive and difficult, so it is hard for federal officials to find all instances of fraud. Whistleblowers are enormously helpful in fighting Medicaid fraud and Medicare fraud, and are encouraged to come forward with generous financial rewards if they can help the government to recover taxpayer funds being lost to fraud.