On July 20, the Department of Justice announced a $1.2 billion health care fraud case. This action involves coordinated nationwide enforcement to charge 36 defendants in 13 federal districts with fraud schemes involving telemedicine, clinical laboratory and durable medical equipment (DME). DOJ officers seized $8 million in cash, a yacht, luxury cars, real estate and other assets paid by fraud proceeds. The defendants are accused of exploiting telemedicine technology, paying bribes, and abusing the health care system.
The Centers for Medicare & Medicare Services (CMS) announced a similar action against 52 providers involved in similar schemes. Charges were filed against a telemedicine company executive, DMS companies, marketing organizations, and medical professionals. Leaving criminal prosecution to the DOJ, the CMS and Center for Program Integrity announced administrative actions.
Amidst the broad scope of the action, the joint investigations mostly looked at these schemes:
- Laboratory owners and operators pay bribes and illegal kickbacks in exchange for patient referrals by medical professionals working for companies in telemedicine (whose schemes amount to a vast majority of the violations) and digital medical technology.
- The action is also notable for being the first prosecution involving the emerging problem of fraudulent cardiovascular genetic testing. The new scheme encourages referrals for costly cancer and cardiovascular genetic testing that is medically unnecessary because, for example, the patient did not have a cardiac condition. The test was not approved as a general screening for determining the risk of developing a cardiovascular condition.
- There were also recommendations for unnecessary durable medical equipment like braces, walkers, crutches, canes, blood sugar test strips, hospital beds for home care, patient lifts, wheelchairs, nebulizers, and other gear.
The latest major action
This action by CMS continues a recent campaign against health care fraud that recovered $8 billion, including 2021’s National Health Care Fraud Enforcement Action, 2020’s Operation Rubber Stamp, 2019’s Operation Double Helix and Operation Brace Yourself.