DOJ announces 78 people charged over $2.5 billion in false health care billings

(WASHINGTON) — The Justice Department on Wednesday announced a nationwide health care fraud crackdown that resulted in charges against 78 defendants in separate schemes that totaled more than $2.5 billion in alleged fraudulent billings, marking what Attorney General Merrick Garland called “one of the largest health care fraud schemes ever prosecuted by the Justice Department.”

The charges across 17 separate federal districts include cases against at least 24 doctors, nurses and other licensed medical professionals accused of various schemes defrauding programs in which the victims largely included those in vulnerable populations — including the elderly, disabled, pregnant women and those with HIV.

As part of the coordinated law enforcement actions between the DOJ, FBI, DEA, HHS Inspector General and other agency partners, the operations also resulted in seizures of more than $10.3 million in assets that included bank accounts, cars, a boat and several homes.

“These enforcement actions, including against one of the largest health care fraud schemes ever prosecuted by the Justice Department, represent our intensified efforts to combat fraud and prosecute the individuals who profit from it,” Garland said in a statement announcing the charges. “The Justice Department will find and bring to justice criminals who seek to defraud Americans and steal from taxpayer-funded programs.”

The cases unsealed over a two-week period this month included “one of the largest health care fraud schemes ever prosecuted” by the department, in which two top executives and a former executive of an internet platform were charged for submitting roughly $1.9 billion in fraudulent claims to Medicare, officials said Wednesday.

The three individuals are alleged to have used their platform DMERx as a means to connect pharmacies and medical equipment suppliers to telemedicine companies who would in turn accept kickbacks and bribes on orders for orthotic braces and prescription pain creams that were not eligible for reimbursement from Medicare. They allegedly programmed the platform to generate templates of false doctors’ orders for the products that were hawked to elderly and disabled people as part of a massive telemarketing operation, resulting in more than $1.96 billion in false claims to Medicare.

In another case announced Wednesday, an owner and corporate officer from a pharmaceutical company were charged for a fraud scheme alleging the company repackaged more than $150 million worth of HIV medication on the street and from patients and then unlawfully resold that medication to pharmacies in order to dispense to patients in need. In some cases, bottles of that medication included wrong or broken pills and even pebbles.

Earlier this month, a person was sentenced to 15 years in prison for his role in a related scheme where he repackaged drugs and tried to sell them to wholesale companies, using the proceeds to buy things like a $280,000 Lamborghini, a $220,000 Mercedes and three boats.