Fake clinics, unnecessary opioid prescriptions involved in $1.3B fraud crackdown

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The U.S. Department of Justice charged 412 people, including 56 doctors, for allegedly participated in false billing schemes netting $1.3 billion, with many cases involving prescriptions of opioids or other narcotics.

U.S. Attorney General Jeff Sessions and HHS Secretary Tom Price, MD, said the announcement was the “largest healthcare fraud takedown in history.” As a result, 295 providers would be suspended or banned from participating in federal health programs, including Medicare and Medicaid.

“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars — it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” Price said in a statement. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud.

The number of arrests and total amount alleged fraud tops 2016’s record sweep, which had replaced the 2015 crackdown as the largest ever. Of the 412 defendants, 120 have been charged with opioid-related crimes, which the DOJ said set an additional record for “largest opioid-related fraud takedown in American history. Florida had the highest number of cases, with 87 defendants being charged in two court jurisdictions.

Here are some examples of alleged schemes included in the crackdown:

  • Six doctors in Michigan were charged with writing unnecessary prescriptions for opioids, with some of the drugs then being sold illegally, and billing Medicare for $164 million in “facet joint injections, drug testing, and other procedures that were medically unnecessary and/or not provided.”
  • Two were charged with running a fake drug rehab clinic in Florida, “actively recruiting” addicted patients to move to the area, submitting $58 million in allegedly false insurance claims for treatment and testing, then rewarding patients with gift like free airfare, trips to strip clubs and drugs.
  • In Houston, two people were charged in connection with a pain management clinic where 60 to 70 people per day given medically unnecessary prescriptions for hydrocodone in exchange for $300 in cash per visit. One physician charged allegedly gave out over 2 million illegal doses of painkillers.
  • In Louisiana, a single pharmacist was involved with $192 million in allegedly false claims by dispensing compounded medications which weren’t medically necessary, often based on prescriptions tied to kickbacks.

“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” Attorney General Sessions said at a July 13 press conference. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards.”