Authorities Crackdown On Major Medicare Fraud In Detroit

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Litigation / Medical Malpractice
Article Date: 26 Jun 2009 - 6:00 PDT

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Fifty-three people were indicted in a major Medicare fraud crackdown in Detroit yesterday, just one day after eight were charged in a similar case in Miami.

The Wall Street Journal: "the two separate cases, a joint effort by the Justice Department and the Health and the Human Services Department, reflect a pickup in the government's pace in combating Medicare fraud. In the Detroit case, the alleged fraud was estimated at $50 million. Those charged included doctors, health-care executives and beneficiaries. The scheme in Miami allegedly used fake storefronts in an attempt to cheat Medicare out of $100 million. The suspects charged in the Detroit operation allegedly submitted bogus Medicare claims for care that was medically unnecessary and often not provided at all. In some instances suspects paid patients to go along with the scheme, the Justice Department, the Federal Bureau of Investigation and HHS said at a joint news conference. Since March 2007, the government's special antifraud teams have produced more than 250 indictments involving Medicare claims totaling more than $600 million in such Medicare-fraud 'hot spots' as South Florida, Los Angeles and Detroit, where abuses of the federal health program for the elderly and disabled are more frequently found."

The charges come as the administration and Congress try to reduce waste and fraud to pay for increased coverage of the uninsured as part of health care reform. The Obama administration has requested $311 million in additional funding to combat fraud. The U.S. pays more than $800 billion on Medicare and on Medicaid and "by some estimates, more than $60 billion each year is lost to fraud." The Wall Street Journal notes: "Ms. Sebelius said the administration is seeking new authority so Medicare can more easily share claims data with other agencies in its efforts to trace con artists. The administration, she said, wants that authority to be included in legislation to overhaul health care. Key Democrats in both the House and Senate plan to include more funding to fight health-care fraud" (Zhang, 6/25).

The Detroit News reports that "the huge case is really a collection of eight cases involving physical therapy and injection or infusion therapy clinics. A common thread is that patients received kickbacks for use of their Medicare numbers... and the hefty spoils were shared among a group of clinic owners, doctors, recruiters and other co-conspirators, according to grand jury indictments unsealed Wednesday." The paper also notes: "Early enforcement efforts in Miami may have pushed fraud schemes to Detroit, accounting for the Florida connections of several of those arrested locally" (Egan and Trowbridge, 6/25).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

© Henry J. Kaiser Family Foundation. All rights reserved.

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