Two Billion-Dollar Healthcare Prosecutions in One Month

Last month, the U.S. Justice Department reported two healthcare prosecutions for billion-dollar frauds.

In the first, federal prosecutors in Florida won what they’ve called the biggest healthcare-fraud conviction ever. The target was the owner of a chain of nursing homes who allegedly billed over a billion dollars in fraudulent claims to Medicare and Medicaid over eighteen years. I say allegedly, but a jury convicted him of twenty counts related to bribes, kickbacks, money laundering, and obstruction of justice, though it hung on a main conspiracy count and five other ones. The government alleged that the defendant billed for services that were either not provided, not medically necessary, or the product of bribery. Here’s more from the Miami Herald.

A few days later, the government took down 24 targets from across the country in another billion-dollar set of cases. The defendants include executives from five telemedicine companies, the owners of dozens of durable-medical-equipment (DME) companies, and three licensed practitioners. According to the government, the DME companies would bribe doctors to refer Medicare patients for medically-unnecessary braces for their back, wrist, knee, or shoulder. Allegedly, the doctors would prescribe the braces for patients they had never met before and without any interaction at all or after just a brief phone call. The proceeds were then laundered, supposedly, through international shell companies to buy cars, yachts, and real estate.

We’ll see how these latter cases play out. Beyond the individual prosecutions, the government has moved to cut off 130 DME companies from further access to federally-funded healthcare programs.