The Department of Justice (DOJ) is cracking down on COVID-19 healthcare fraud, charging 18 individuals for their involvement in various fraud schemes resulting in more than $490 million in false billings.
The 18 defendants came from 19 regions across the United States and are accused of participating in fraud schemes that exploited the COVID-19 pandemic. The DOJ seized more than $16 million in cash in connection with the fraud schemes. In addition, the Centers for Medicare and Medicaid Services (CMS) announced it is taking action against 28 medical medical providers for their alleged involvement in COVID-19 fraud schemes.
“Today’s announcement marks the largest-ever coordinated law enforcement action in the United States targeting healthcare fraud schemes that exploit the COVID-19 pandemic,” Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division said in a statement. “The Criminal Division’s Health Care Fraud Unit and our partners are committed to rooting out pandemic-related fraud and holding accountable anyone seeking to profit from a public health emergency.”
The COVID-19 pandemic created chaos in the U.S. healthcare system overnight, prompting Congress and the Trump and Biden administrations to quickly make decisions and broaden healthcare benefits and billing capabilities. This included expanding Medicaid eligibility, health insurance subsidies and telehealth services, among other changes, to ensure more people could receive essential care over the past few years as the pandemic conditions changed quickly. The expanded benefits and services also potentially enabled more fraud to take place during this time period, and now federal agencies are seeking out wrongdoers to claw back any unlawful funds.
Other various COVID-19 healthcare fraud schemes have been uncovered and persecuted over the past two years.
Defendants in this latest fraud scheme enforcement action were charged with defrauding the Health Resources and Services Administration (HRSA) COVID-19 Uninsured Program, which was designed to prevent the further spread of the pandemic by providing access to uninsured patients for testing and treatment, the Justice Dept. said. The program also provided financial support for healthcare providers fighting the pandemic by reimbursing them for services provided to uninsured individuals. The program ended when funding was exhausted.
Among the defendants is a lab owner in the Central District of California who was charged for allegedly submitting over $358 million in false and fraudulent claims to Medicare, HRSA, and a private insurance company for laboratory testing. The defendant allegedly performed COVID-19 screening testing for nursing homes and other facilities with vulnerable elderly populations, as well as primary and secondary schools, but padded the test reimbursement rates by adding respiratory pathogen panel tests that were not needed or wanted by providers or facility administrators.
In the same region, another doctor, who was the second highest biller in the country to the Uninsured Program, was charged for allegedly orchestrating an approximately $230 million fraud on the program. He allegedly submitted fraudulent claims for treatment of patients who were insured, billed for services that were not rendered, and billed for services that were not medically necessary, the agency said. He is also charged with two other individuals for allegedly submitting over 70 fraudulent loan applications through the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) Program and fraudulently obtaining over $3 million in loan funds.
“The Justice Department will not tolerate those who exploited the pandemic for personal gain and stole taxpayer dollars,” said Attorney General Merrick B. Garland. “This unprecedented enforcement action against defendants across the country makes clear that the Department is using every available resource to combat and prevent COVID-19 related fraud and safeguard the integrity of taxpayer-funded programs.”
In addition to the hundreds of millions in fraud from the two doctors called out by the DOJ, the agency announced first-of-their-kind charges against suppliers of COVID-19 over-the-counter tests, which Medicare has covered since April 2022 for beneficiaries who request them. One doctor and a marketer in the Middle District of Florida were charged for allegedly unlawfully purchasing Medicare beneficiary identification numbers and shipping OTC tests to beneficiaries throughout the country who did not request the tests. The case resulted in more than $8.4 million in fraudulent claims to Medicare.
The DOJ also announced charges over fake COVID-19 vaccine cards and fraud of the Health Care Fraud Unit’s Provider Relief Fund (PRF) Initiative, which is part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act that provided financial assistance to medical providers to deliver needed medical care to Americans suffering from COVID-19.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."