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Paul Zimmerman
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Criminal Charges Brought in $1 Billion Alleged Medicare Fraud Scheme

If the June 2016 nationwide Medicare fraud takedown was not a sufficient indicator, today’s announcement that the U.S. Department of Justice (DOJ) has filed criminal charges against three Florida individuals alleging more than $1 billion in health care fraud, should make very clear that the federal government is cracking down on Medicare schemes.

The owner of more than 30 Miami-area skilled nursing and assisted living facilities, a hospital administrator and a physician’s assistant were charged with conspiracy, obstruction, money laundering and health care fraud involving numerous Miami-based health care providers.

According to the federal indictment, Philip Esformes, with his alleged co-conspirators, admitted many Medicare and Medicaid beneficiaries to the Esformes Network facilities despite knowing that they did not qualify for such care. At those facilities, they also "received medically unnecessary services that were billed to Medicare and Medicaid," according to the U.S. attorney. They are also alleged to have further enriched themselves by receiving kickbacks in order to steer these beneficiaries to other health-care providers — including community mental health centers and home health-care providers — who also performed medically unnecessary treatments that were billed to Medicare and Medicaid, the DOJ said.

Assistant Attorney General Leslie R. Caldwell announced that “this is the largest single criminal health care fraud case ever brought against individuals by the Department of Justice, and this is further evidence of how successful data-driven law enforcement has been as a tool in the ongoing fight against health care fraud.” Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine locations across the country, has charged nearly 2,900 defendants who have collectively billed the Medicare program for more than $10 billion.

Owners and operators of skilled nursing and assisted living facilities, as well as other health care providers who bill Medicare, should view this latest development as a wake-up call. In light of this most-recent action by the Medicare Fraud Strike Force, providers should work with experienced counsel and professionals to review business relationships, protocols, marketing strategies, billing practices, referral methods, and compliance with federal and state law.

This blog post is not offered as, and should not be relied on as, legal advice. You should consult an attorney for advice in specific situations.