Government Teams Recovered $4.3B in FY2013 and $19.2B over the Last 5 Years

Attorney General Eric Holder and HHS Secretary Kathleen Sebelius today released the annual Health Care Fraud and Abuse Control (HCFAC) Program report showing that for every dollar spent on health care-related fraud and abuse investigations through this and other programs in the last three years, the government recovered $8.10.  This is the highest three-year average return on investment in the 17-year history of the HCFAC Program.

810The government’s health care fraud prevention and enforcement efforts recovered a record-breaking $4.3 billion in taxpayer dollars in Fiscal Year (FY) 2013, up from $4.2 billion in FY 2012, from individuals and companies who attempted to defraud federal health programs serving seniors or who sought payments from taxpayers to which they were not entitled.  Over the last five years, the administration’s enforcement efforts have recovered $19.2 billion, up from $9.4 billion over the prior five-year period.  Since the inception of the program in1997, the HCFAC Program has returned more than $25.9 billion to the Medicare Trust Funds and treasury.

These recoveries, released today in the annual HCFAC Program report, demonstrate President Obama’s commitment to making the elimination of fraud, waste and abuse, particularly in health care, a top priority for the administration.  This is the fifth consecutive year that the program has increased recoveries over the past year, climbing from $2 billion in FY 2008 to over $4 billion every year since FY 2011.

The success of this joint Department of Justice and HHS effort was made possible in part by the Health Care Fraud Prevention and Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in Medicare and Medicaid and to crack down on individuals and entities that are abusing the system and costing American taxpayers billions of dollars.

“With these extraordinary recoveries, and the record-high rate of return on investment we’ve achieved on our comprehensive health care fraud enforcement efforts, we’re sending a strong message to those who would take advantage of their fellow citizens, target vulnerable populations, and commit fraud on federal health care programs,” said Attorney General Eric Holder.  “Thanks to initiatives like HEAT, our work to combat fraud has never been more cooperative or more effective.  And our unprecedented commitment to holding criminals accountable, and securing remarkable results for American taxpayers, is paying dividends.”

“These impressive recoveries for the American taxpayer are just one aspect of the comprehensive anti-fraud strategy we have implemented since the passage of the Affordable Care Act,” said HHS Secretary Sebelius.  “We’ve cracked down on tens of thousands health care providers suspected of Medicare fraud. New enrollment screening techniques are proving effective in preventing high risk providers from getting into the system, and the new computer analytics system that detects and stops fraudulent billing before money ever goes out the door is accomplishing positive results – all of which are adding to savings for the Medicare Trust Fund.”

The new authorities under the Affordable Care Act granted to HHS and the Centers for Medicare & Medicaid Services (CMS) were instrumental in clamping down on fraudulent activity in health care.  In FY 2013, CMS announced the first use of its temporary moratoria authority granted by the Affordable Care Act.  The action stopped enrollment of new home health or ambulance enrollments in three fraud hot spots around the country, allowing CMS and its law enforcement partners to remove bad actors from the program while blocking provider entry or re-entry into these already over-supplied markets.

The Justice Department and HHS have improved their coordination through HEAT and are currently operating Medicare Fraud Strike Force teams in nine areas across the country. The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes as well as chronic fraud by criminals masquerading as health care providers or suppliers. The Justice Department’s enforcement of the civil False Claims Act and the Federal Food, Drug and Cosmetic Act has produced similar record-breaking results.  These combined efforts coordinated under HEAT have expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud.

In Fiscal Year 2013, the strike force secured records in the number of cases filed (137), individuals charged (345), guilty pleas secured (234) and jury trial convictions (46). Beyond these remarkable results, the defendants who were charged and sentenced are facing significant time in prison – an average of 52 months in prison for those sentenced in FY 2013, and an average of 47 months in prison for those sentenced since 2007.

In FY 2013, the Justice Department opened 1,013 new criminal health care fraud investigations involving 1,910 potential defendants, and a total of 718 defendants were convicted of health care fraud-related crimes during the year.  The department also opened 1,083 new civil health care fraud investigations.

The strike force coordinated a takedown in May 2013 that resulted in charges by eight strike force cities against 89 individuals, including doctors, nurses and other licensed medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $223 million in false billings. As a part of the May 2013 takedown, HHS also suspended or took other administrative action against 18 providers using authority under the health care law to suspend payments until an investigation is complete.

In FY 2013, the strike force secured records in the number of cases filed (137), individuals charged (345), guilty pleas secured (234) and jury trial convictions (48). Beyond these remarkable results, the defendants who were charged and sentenced are facing significant time in prison – an average of 52 months in prison for those sentenced in FY 2013, and an average of 47 months in prison for those sentenced since 2007.

In March 2011, CMS began an ambitious project to revalidate all 1.5 million Medicare enrolled providers and suppliers under the Affordable Care Act screening requirements. As of September 2013, more than 535,000 providers were subject to the new screening requirements and over 225,000 lost the ability to bill Medicare due to the Affordable Care Act requirements and other proactive initiatives.  Since the Affordable Care Act, CMS has also revoked 14,663 providers and suppliers’ ability to bill the Medicare program. These providers were removed from the program because they had felony convictions, were not operational at the address CMS had on file, or were not in compliance with CMS rules.

HHS and the Justice Department are leading historic efforts with the private sector to bring innovation to the fight against health care fraud. In addition to real-time data and information exchanges with the private sector, CMS’ Program Integrity Command Center worked with the HHS Office of the Inspector General and the FBI to conduct 93 missions to detect, investigate, and reduce improper payments in FY 2013.

From May 2013 through August 2013, CMS led an outreach and education campaign targeted to specific communities where Medicare fraud is more prevalent.  This multimedia campaign included national television, radio, and print outreach and resulted in an increased awareness of how to detect and report Medicare fraud.

To read today’s report visit http://oig.hhs.gov/publications/docs/hcfac/FY2013-hcfac.pdf

For previous years’ reports visit https://oig.hhs.gov/reports-and-publications/hcfac/index.asp

For more information on the joint DOJ-HHS Strike Force activities, visit: www.StopMedicareFraud.gov/.

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Medicare Fraud Strike Force Charges 91 Individuals for Approximately $430 Million in False Billing

Medicare Fraud Strike Force operations in seven cities have led to charges against 91 individuals – including doctors, nurses and other licensed medical professionals – for their alleged participation in Medicare fraud schemes involving approximately $429.2 million in false billing, Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius announced today.

Attorney General Holder and Secretary Sebelius were joined in the announcement of the nationwide takedown by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, FBI Associate Deputy Director Kevin Perkins, Inspector General Daniel R. Levinson of the HHS Office of Inspector General (HHS-OIG) and Dr. Peter Budetti, Deputy Administrator for Program Integrity of the Centers for Medicare and Medicaid Services (CMS).

“Today’s enforcement actions reveal an alarming and unacceptable trend of individuals attempting to exploit federal health care programs to steal billions in taxpayer dollars for personal gain,” said Attorney General Holder.  “Such activities not only siphon precious taxpayer resources, drive up health care costs, and jeopardize the strength of the Medicare program – they also disproportionately victimize the most vulnerable members of society, including elderly, disabled and impoverished Americans.”

“Today’s arrests put criminals on notice that we are cracking down hard on people who want to steal from Medicare,” said HHS Secretary Sebelius.  “The health care law gives us new tools to better fight fraud and make Medicare stronger.  In addition to the arrests made today, HHS used new authority from the health care law to stop future payments to many of the health care providers suspected of fraud, saving Medicare resources and taxpayer dollars from being lost to fraud in the first place.”

Dozens of charged individuals were arrested or surrendered in the last 24 hours as indictments were unsealed across the country.  Together, those indictments charge more than $230 million in home health care fraud; more than $100 million in mental health care fraud and more than $49 million in ambulance transportation fraud; and millions more in other frauds.

HHS also suspended or took other administrative action against 30 health care providers following a data-driven analysis and based upon credible allegations of fraud.  Under the Affordable Care Act, HHS is able to suspend payments until the resolution of an investigation.

The joint Department of Justice and HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators and prosecutors designed to combat Medicare fraud through the use of Medicare data analysis techniques.  More than 500 law enforcement agents from the FBI, HHS-OIG, multiple Medicaid Fraud Control Units, and other state and local law enforcement agencies participated in the takedown.

The defendants charged are accused of various health care fraud-related crimes, including conspiracy to commit health care fraud, health care fraud, violations of the anti-kickback statutes and money laundering.  The charges are based on a variety of alleged fraud schemes involving various medical treatments and services such as home health care, mental health services, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and ambulance services.

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes never provided.  In many cases, court documents allege that patient recruiters, Medicare beneficiaries and other co-conspirators were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could submit fraudulent billing to Medicare for services that were medically unnecessary or never provided.  Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of conspiring to submit a total of approximately $429.2 million in fraudulent billing.

“Today’s coordinated actions represent one of the largest Medicare fraud takedowns in Department of Justice history, as measured by the amount of alleged fraudulent billings,” said Assistant Attorney General Breuer.  “We have made it one of the Department’s missions to hold accountable those who abuse the Medicare program for personal profit.  And there are Medicare fraudsters in prisons across the country – some who will be there for decades – who can attest to our determination, and our effectiveness.”

“Health care fraud leads to higher health care costs and makes quality care more difficult to obtain,” said FBI Associate Deputy Director Perkins. “Working together to stop fraud, as we did today, will ensure that Americans’ hard-earned dollars are used to care for the sick – not to line the pockets of criminals.”

“Today’s coordinated operation demonstrates that law enforcement is flexible enough to address health care fraud in its many evolving forms,” said HHS Inspector General Levinson.  “When home health agencies, durable medical equipment companies, pharmacies, or other health care providers are suspected of breaking the law, they can expect to be caught and held accountable.”

“This is the result of coordinated anti-fraud efforts – including Medicare flagging suspicious activity, efforts between agencies to investigate this criminal activity, and today’s actions by law enforcement and HHS,” said CMS Deputy Administrator for Program Integrity Budetti.  “As we stop payments to these providers suspected of fraud, we continue our efforts to move from a pay-and-chase model to one where we stop fraudsters before they can successfully bill Medicare and Medicaid.”

In Miami, a total of 33 defendants are charged for their alleged participation in various fraud schemes involving a total of $204.5 million in false billings for home health care, mental health services, occupational and physical therapy, and DME.  In one case, three defendants are charged for participating in a fraud scheme at LTC Professional Consultants and Professional Home Care Solutions Inc. which led to approximately $74 million in fraudulent billing for home health care.  In another case, five defendants are charged for participating in a fraud scheme at Hollywood Pavilion which led to $67 million in fraudulent billing for mental health services.

Sixteen individuals, including three doctors and one licensed physical therapist, are charged in Los Angeles with participating in various fraud schemes involving a total of $53.8 million in false billings.  In one case, four defendants are charged for allegedly participating in a fraud scheme at Alpha Ambulance Inc., which led to approximately $49.2 million in fraudulent billing for ambulance transportation.  The case represents the largest ambulance fraud scheme ever prosecuted by the Medicare Fraud Strike Force.  According to court documents, the defendants provided beneficiaries ambulance rides that were medically unnecessary.

In Dallas, 14 individuals – including two doctors and two registered nurses – are charged for their alleged participation in various fraud schemes involving a total of $103.3 million in false billings.  In one case, three defendants – a medical doctor and two registered nurses – are charged with participating in a fraud scheme at Raphem Medical Practice and PTM Healthcare Services which led to approximately $100 million in fraudulent billing for home health care services.  According to court documents, Dr. Joseph Megwa signed approximately 33,000 prescriptions for more than 2,000 unique Medicare beneficiaries from 2006 to 2011.  Many of these Medicare beneficiaries had primary care physicians who never certified home healthcare services for them.  In order to handle the volume of prescriptions, Megwa allegedly signed stacks of documents without reviewing them.

Seven individuals are charged in Houston for their participation in a fraud scheme at a hospital which led to $158 million in fraudulent billing for community mental health center services.  According to court documents, the defendants who served as administrators at the hospital paid kickbacks – in the form of cigarettes, food and coupons redeemable for items available at the hospital’s “country stores” – to Medicare beneficiaries in exchange for those beneficiaries’ attendance at the hospital’s partial hospitalization programs (PHP).  Allegedly, beneficiaries watched television, played games and engaged in other non-PHP activities rather than receiving the services for which the hospital billed Medicare.  Previously, on Feb. 22, 2012, the assistant administrator of the hospital, Mohammad Kahn, pleaded guilty to conspiracy to commit health care fraud and paying kickbacks related to $116 million worth of fraudulent claims submitted to Medicare.  After his guilty plea, an additional $42 million in fraudulent claims were discovered that are included in today’s totals.

In Brooklyn, 15 individuals, including one doctor and four chiropractors, are charged for their alleged participation in various fraud schemes involving a total of $23.2 million in false billings.  In one case, nine defendants, including a medical doctor, are charged with participating in a fraud scheme at Cropsey Medical Care PLLC which led to approximately $13.8 million in fraudulent billing for physical therapy and related services. According to court documents, the defendants paid cash kickbacks to Medicare beneficiaries in exchange for physical therapy that was not medically necessary and on some occasions never provided to beneficiaries.

In Baton Rouge, four defendants, including a licensed practical nurse, are charged for their roles in fraud schemes involving approximately $2.4 million in false claims for medically unnecessary durable medical equipment.

In Chicago, two defendants, including a dermatologist and a psychologist, are charged for their roles in fraud schemes involving, according to court documents, millions of dollars in false claims for medically unnecessary laser treatments and psychotherapy services.

The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since their inception in March 2007, strike force operations in nine locations have charged more than 1,480 defendants who collectively have falsely billed the Medicare program for more than $4.8 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The cases announced today are being prosecuted and investigated by Medicare Fraud Strike Force teams comprising attorneys from the Fraud Section of the Justice Department’s Criminal Division and from the U.S. Attorneys’ Offices for the Southern District of Florida, the Southern District of Texas, the Northern District of Texas, the Central District of California, the Middle District of Louisiana, the Northern District of Illinois, and the Eastern District of New York, and agents from the FBI, HHS-OIG and state Medicaid Fraud Control Units, with assistance from the Justice Department’s Civil Division and the IRS.

The charges and allegations contained in the indictments are merely accusations and the defendants are presumed innocent unless and until proven guilty.

To learn more about HEAT, go to: www.stopmedicarefraud.gov.

Medicare Fraud Task Force Nets $452M

OR IMMEDIATE RELEASE
May 2, 2012
Contact: HHS Press Office
(202) 690-6343

Medicare Fraud Strike Force charges 107 individuals for approximately $452 million in false billing

Health and Human Services (HHS) Secretary Kathleen Sebelius and Attorney General Eric Holder announced today that a nationwide takedown by Medicare Fraud Strike Force operations in seven cities has resulted in charges against 107 individuals, including doctors, nurses and other licensed medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $452 million in false billing.

Attorney General Holder and Secretary Sebelius were joined in the announcement by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, Federal Bureau of Investigations (FBI) Deputy Director Sean Joyce, Deputy Inspector General for Investigations Gary Cantrell of the HHS Office of Inspector General (HHS-OIG) and Dr. Peter Budetti, Deputy Administrator for Program Integrity of the Centers for Medicare & Medicaid Services (CMS).

This coordinated takedown involved the highest amount of false Medicare billings in a single takedown in Strike Force history.

HHS also suspended or took other administrative action against 52 providers following a data-driven analysis and credible allegations of fraud.  The new health care law, the Affordable Care Act, significantly increased HHS’ ability to suspend payments until an investigation is complete.

The joint Department of Justice and HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques.  More than 500 law enforcement agents from the FBI, HHS-OIG, multiple Medicaid Fraud Control Units, and other state and local law enforcement agencies participated in the takedown.  In addition to making arrests, agents also executed 20 search warrants in connection with ongoing Strike Force investigations.

“The results we are announcing today are at the heart of an administration-wide commitment to protect American taxpayers from health care fraud, which can drive up costs and threaten the strength and integrity of our health care system,” said Attorney General Holder.  “We are determined to bring to justice those who violate our laws and defraud the Medicare program for personal gain.  As today’s takedown reflects, our ongoing fight against health care fraud has never been more coordinated and effective.”

“Today’s arrests send a strong message to criminals that the consequences of committing Medicare fraud are serious,” said HHS Secretary Sebelius.  “In addition to these arrests, we used new authority from the health care law to stop all future payments to 52 health care providers suspected of fraud before they are ever made.  Today’s actions are another example of how the Affordable Care Act is helping the Obama administration fight fraud and strengthen Medicare.”

The defendants charged are accused of various health care fraud-related crimes, including conspiracy to commit health care fraud, health care fraud, violations of the anti-kickback statutes and money laundering.  The charges are based on a variety of alleged fraud schemes involving various medical treatments and services such as home health care, mental health services, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and ambulance services.

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes never provided.  In many cases, court documents allege that patient recruiters, Medicare beneficiaries and other co-conspirators were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could submit fraudulent billing to Medicare for services that were medically unnecessary or never provided.  Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of conspiring to submit a total of approximately $452 million in fraudulent billing.

“As charged in the indictments, these fraud schemes were committed by people up and down the chain of health care providers,” said Assistant Attorney General Breuer.  “Today’s operations mark the fourth in a series of historic Medicare fraud takedowns over the past two years.  These indictments remind us that Medicare is an attractive target for criminals.  But it should also remind those criminals that they risk prosecution and prison time every time they submit a false claim.”

“Health care fraud is not a victimless crime,” said FBI Deputy Director Joyce.  “Every person who pays for health care benefits, every business that pays higher insurance costs to cover their employees, every taxpayer who funds Medicare—all are victims.  The FBI will continue to work closely with our federal, state and local law enforcement partners to address health care vulnerabilities, fraud and abuse.  We will use every tool we have to ensure our health care dollars are used to care for the sick—not to line the pockets of criminals.”

“Today more than 200 OIG Special Agents, Forensic Examiners and Analysts have deployed throughout the country to ensure that those responsible for committing Medicare fraud are held accountable,” said HHS-OIG Deputy Inspector General Cantrell.  “OIG is committed to the strike force model and will continue to use advanced data analytics along with traditional investigative methods to root out those who steal from our Medicare program.”

In Miami, a total of 59 defendants, including three nurses and two therapists, were charged today and yesterday for their participation in various fraud schemes involving a total of $137 million in false billings for home health care, mental health services, occupational and physical therapy, DME and HIV infusion.  Two of these 59 defendants were originally charged in April 2012 but were indicted on additional charges today.  In one case, 10 defendants were charged for participating in a fraud scheme at Health Care Solutions Network, which led to approximately $63 million in fraudulent billing for community mental health center (CMHC) services.  Court documents allege that therapists at Health Care Solutions Network were instructed to alter notes and other medical documents to justify CMHC services for beneficiaries who did not need the services.

Seven individuals were charged today in Baton Rouge, La., for participating in a fraud scheme involving $225 million in false claims for CMHC services.  The case represents the largest CMHC-related scheme ever prosecuted by the Strike Force.  According to court documents, the defendants recruited beneficiaries from nursing homes and homeless shelters, some of whom were drug addicted or mentally ill, and provided them with no services or medically inappropriate services.

In Houston, nine individuals, including one doctor and one nurse, were charged today with fraud schemes involving a total of $16.4 million in false billings for home health care and ambulance services.  According to court documents, the owners and operators of four different ambulance companies billed Medicare for ambulance rides that were medically unnecessary.

Eight defendants, including two doctors, were charged in Los Angeles for their roles in schemes to defraud Medicare of approximately $14 million.  In one case, two individuals allegedly billed Medicare for more than $8 million in fraudulent billing for DME.

In Detroit, 22 defendants, including four licensed social workers, were charged for their roles in fraud schemes involving approximately $58 million in false claims for medically unnecessary services, including home health, psychotherapy and infusion therapy.

In Tampa, Fla., a pharmacist was charged with illegal diversion of controlled substances.  One defendant was charged last week in Chicago for his alleged role in a scheme to submit approximately $1 million in false billing to Medicare for psychotherapy services.

The Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,330 defendants who collectively have falsely billed Medicare for more than $4 billion.  In addition, the CMS, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The cases announced today are being prosecuted and investigated by Strike Force teams comprised of attorneys from the Fraud Section of the Justice Department’s Criminal Division and from the U.S. Attorneys’ Offices for the Southern District of Florida, the Eastern District of Michigan, the Southern District of Texas, the Central District of California, the Middle District of Louisiana, the Northern District of Illinois, and the Middle District of Florida, and agents from the FBI, HHS-OIG and state Medicaid Fraud Control Units.

An indictment is merely a charge and defendants are presumed innocent until proven guilty.

To learn more about HEAT, go to: www.stopmedicarefraud.gov.

Repealing Health Care Reform Would Also Repeal Medicare Fraud Tools

FOR IMMEDIATE RELEASE
April 4, 2012
Contact: HHS
HHS Press Office

HHS, Department of Justice highlight Obama administration efforts —
Health Reform tools to combat Medicare fraud

 HHS Secretary and Attorney General host seventh Regional Health Care Fraud Prevention Summit in Chicago

At a Chicago summit highlighting a new high-tech war against health care fraud, Health and Human Services (HHS) Secretary Kathleen Sebelius and Attorney General Eric Holder today discussed how the Affordable Care Act and the Obama administration’s Health Care Fraud Prevention and Enforcement Action Team (HEAT) are helping fight Medicare fraud.  The Chicago summit is the seventh regional health care fraud prevention summit hosted by the Department of Justice and HHS.

The regional summits bring together a wide array of public and private partners, and are part of the HEAT partnership between HHS and the Department of Justice to prevent and combat health care fraud.  The Obama administration’s HEAT efforts have resulted in record-breaking health care fraud recoveries.  In fiscal year 2011, for the second year in a row, the departments’ anti-fraud activities resulted in more than $4 billion in recoveries, an all-time high.

“We have a simple message to criminals thinking about committing Medicare fraud: don’t even try,” said Secretary Sebelius. “Thanks to health reform and our administration’s work, we have new tools and resources to catch criminals and stop Medicare fraud before it happens.”

“This Administration continues to move aggressively in protecting patients and consumers and bringing health care fraud criminals to justice,” said Attorney General Holder.  “Through HEAT, we have achieved unprecedented, record-breaking successes in combating health care fraud and as a result of the Affordable Care Act, we have additional critical resources, tools and authorities to continue this great success.”

New tools provided by the Affordable Care Act are strengthening the Obama administration’s efforts to fight health care fraud.  As a result of Affordable Care Act provisions:

  • Criminals face tougher sentences for health care fraud, 20-50 percent longer for crimes that involve more than $1 million in losses;
  • Contractors that police Medicare for waste, fraud, and abuse will expand their work to Medicaid, Medicare Advantage, and Medicare Part D programs;
  • Government entities, including states, the Centers for Medicare & Medicaid Services (CMS), and law enforcement partners at the Office of the Inspector General (OIG) and DOJ, have greater abilities to work together and share information so that CMS can prevent money from going to bad actors by using its authority to suspend payments to providers and suppliers engaged in suspected fraudulent activity.

Increased collaboration has yielded significant results through the HEAT partnership.  Since the creation of HEAT in 2009, the Medicare Fraud Strike Force operations have expanded from two to nine locations throughout the United States, including Chicago.  Strike Force operations expanded to Chicago in February 2011 and since that time, charges have been filed against more than 35 defendants in the Northern District of Illinois for offenses related to health care fraud.  Overall, in fiscal year 2011, strike force operations in nine locations charged a total of more than 320 defendants for allegedly billing more than $1 billion in false claims.

In February, as a result of HEAT and strike force actions, a Dallas-area physician and the office manager of his medical practice, along with five owners of home health agencies, were arrested on charges related to their alleged participation in a nearly $375 million health care scheme involving fraudulent claims for home health services.  In conjunction with this action, CMS imposed payment suspensions against 78 home health agencies in the Dallas area.

Today, the Obama administration also announced more progress from its anti-fraud efforts, beyond the nearly $4.1 billion recovered last year:

  • In the early phase of revalidating the enrollment of providers in Medicare, 234 providers were removed from the program because they were deceased, debarred or excluded by other federal agencies, or were found to be in false storefronts or otherwise invalid business locations;
  • In 2011, HHS revoked 4,850 Medicaid providers and suppliers and deactivated 56,733 Medicare providers and suppliers as it took steps to close vulnerabilities in Medicare;
  • In 2011, HHS saved $208 million through pre-payment edits that stop implausible claims before they are paid;
  • Prosecutions are up: the number of individuals charged with fraud increased from 797 in fiscal year 2008 to 1,430 in fiscal 2011 – nearly a 75 percent increase;
  • In the first few weeks of enhanced site visits required under the ACA screening requirements, HHS found 15 providers and suppliers whose business locations were non-operational and terminated their billing privileges;
  • Through outreach and engagement efforts more than 49,000 complaints of fraud from seniors and people with disabilities reported to 1-800-MEDICARE were referred for further evaluation;
  • A recent re-design of the quarterly Medicare Summary Notices received by Medicare beneficiaries makes it easier to spot and report fraud.

See this fact sheet for additional details about the Obama administration’s efforts to combat health care fraud.

PPACA: Enforcement Efforts Recover ~$4.1B

FOR IMMEDIATE RELEASE
February 14, 2012
Contact: http://www.justice.gov | (202) 514-2007
HHS Press Office | (202) 690-6343

Health Care Fraud Prevention and Enforcement Efforts Result
in Record-Breaking Recoveries Totaling Nearly $4.1 Billion

Largest Sum Ever Recovered in Single Year

WASHINGTON –Attorney General Eric Holder and Department of Health and Human Services (HHS) Secretary Kathleen Sebelius today released a new report showing that the government’s health care fraud prevention and enforcement efforts recovered nearly $4.1 billion in taxpayer dollars in Fiscal Year (FY) 2011.  This is the highest annual amount ever recovered from individuals and companies who attempted to defraud seniors and taxpayers or who sought payments to which they were not entitled.

These findings, released today, in the annual Health Care Fraud and Abuse Control Program (HCFAC) report, are a result of President Obama making the elimination of fraud, waste and abuse a top priority in his administration.  The success of this joint Department of Justice and HHS effort would not have been possible without the Health Care Fraud Prevention & Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in the Medicare and Medicaid programs, and to crack down on the fraud perpetrators who are abusing the system and costing American taxpayers billions of dollars.  These efforts to reduce fraud will continue to improve with the new tools and resources provided by the Affordable Care Act.

“This report reflects unprecedented successes by the Departments of Justice and Health and Human Services in aggressively preventing and combating health care fraud, safeguarding precious taxpayer dollars and ensuring the strength of our essential health care programs,” said Attorney General Holder.  “We can all be proud of what’s been achieved in the last fiscal year by the Department’s prosecutors, analysts and investigators – and by our partners at HHS.  These efforts reflect a strong, ongoing commitment to fiscal accountability and to helping the American people at a time when budgets are tight.”

“Fighting fraud is one of our top priorities and we have recovered an unprecedented number of taxpayer dollars,” said Secretary Sebelius.  “Our efforts strengthen the integrity of our health care programs, and meet the President’s call for a return to American values that ensure everyone gets a fair shot, everyone does their fair share, and everyone plays by the same rules.”

Approximately $4.1 billion stolen or otherwise improperly obtained from federal health care programs was recovered and returned to the Medicare Trust Funds, the Treasury and others in FY 2011.  This is an unprecedented achievement for HCFAC, a joint effort of the two departments to coordinate federal, state and local law enforcement activities to fight health care fraud and abuse.

The recently-enacted Affordable Care Act provides additional tools and resources to help fight fraud that will help boost these efforts, including an additional $350 million for HCFAC activities.  The administration is already using tools authorized by the Affordable Care Act, including enhanced screenings and enrollment requirements, increased data sharing across government, expanded overpayment recovery efforts and greater oversight of private insurance abuses.

Since 2009, the Departments of Justice and HHS have enhanced their coordination through HEAT and have increased the number of Medicare Fraud Strike Force teams.  During FY 2011, HEAT and the Medicare Fraud Strike Force expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud.  The departments hosted a series of regional fraud prevention summits around the country, provided free compliance training for providers and other stakeholders and sent letters to state attorneys general urging them to work with HHS and federal, state and local law enforcement officials to mount a substantial outreach campaign to educate seniors and other Medicare beneficiaries about how to prevent scams and fraud.

In FY 2011, the total number of cities with strike force prosecution teams was increased to nine, all of which have teams of investigators and prosecutors from the Justice Department, the FBI, and the HHS Office of Inspector General, dedicated to fighting fraud.  The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes along with chronic fraud by criminals masquerading as health care providers or suppliers.  In FY 2011, strike force operations charged a record number of 323 defendants, who allegedly collectively billed the Medicare program more than $1 billion.  Strike force teams secured 172 guilty pleas, convicted 26 defendants at trial and sentenced 175 defendants to prison.  The average prison sentence in strike force cases in FY 2011 was more than 47 months.

Including strike force matters, federal prosecutors filed criminal charges against a total of 1,430 defendants for health care fraud related crimes.  This is the highest number of health care fraud defendants charged in a single year in the department’s history.  Including strike force matters, a total of 743 defendants were convicted for health care fraud-related crimes during the year.

In criminal matters involving the pharmaceutical and device manufacturing industry, the department obtained 21 criminal convictions and $1.3 billion in criminal fines, forfeitures, restitution and disgorgement under the Food, Drug and Cosmetic Act.  These matters included the illegal marketing of medical devices and pharmaceutical products for uses not approved by the Food and Drug Administration (FDA) or the distribution of products that failed to conform to the strength, purity or quality required by the FDA.

The departments also continued their successes in civil health care fraud enforcement during FY 2011.  Approximately $2.4 billion was recovered through civil health care fraud cases brought under the False Claims Act (FCA).  These matters included unlawful pricing by pharmaceutical manufacturers, illegal marketing of medical devices and pharmaceutical products for uses not approved by the FDA, Medicare fraud by hospitals and other institutional providers, and violations of laws against self-referrals and kickbacks.  This marked the second year in a row that more than $2 billion has been recovered in FCA health care matters and, since January 2009, the department has used the False Claims Act to recover more than $6.6 billion in federal health care dollars.

The fraud prevention and enforcement report announced today coincides with the announcement of a proposed rule from the Centers for Medicare and Medicaid Services aimed at recollecting overpayments in the Medicare program. Before the Affordable Care Act, providers and suppliers did not face a deadline for returning taxpayers’ money. Thanks to the Affordable Care Act, there will be a specific timeframe by which self-identified overpayments must be returned. The Obama Administration has made prevention and recollection of overpayments a government-wide priority. These announcements today are just the latest in a series of steps that the administration is taking to protect taxpayer dollars and keep money in the pockets of Americans.

The HCFAC annual report can be found here, oig.hhs.gov/publications/hcfac.asp.  For more information on the joint DOJ-HHS Strike Force activities, visit: www.StopMedicareFraud.gov/.

For more information on the fraud prevention accomplishments under the Affordable Care Act visit:http://www.healthcare.gov/news/factsheets/2012/02/medicare-fraud02142012a.html