DOJ Charges 138 People Over $1.4 Billion in Pandemic-Era Healthcare Scams

The Department of Justice announced on Friday that it’s charging 138 people—including 42 doctors, nurses, and myriad medical professionals working in telemedicine—for allegedly participating in a collection of healthcare fraud schemes that wound up costing taxpayers around $1.4 billion in losses. The biggest culprit? Telemedicine fraud, according to the DOJ, which was responsible for more than three-quarters of the lost funds.

© Photo: David Esnault (Getty Images)

More than $1.1 billion in allegedly phony claims were submitted by 43 of the culprits involved in the telemedicine fraud case, who collectively spent those proceeds on “luxury items, including vehicles, yachts, and real estate,” the Justice Department said.

Citing court records, it laid out the alleged scheme like so: First, the accused telemedicine executives would allegedly pay doctors and nurses to order unnecessary, expensive medical equipment, diagnostic testing, and pain meds, all purchased with little (if any) patient interaction on their part. Next, medical equipment providers, genetic testing labs, and pharmacies would all buy back those sham purchases in exchange for “illegal kickbacks and bribes,” the DOJ said, before submitting more than $1.1 billion in phony claims to Medicare or other issuers. In some cases, these same medical professionals are alleged to have billed Medicare for telehealth consultations “that did not occur as represented,” whatever that might mean.

Other schemes mentioned in the DOJ’s charges include “various health care fraud schemes designed to exploit the COVID-19 pandemic,” like exploiting the increased access some providers had to patient’s health data. In these cases, nine of the defendants are alleged to have used that newfound data access to submit Medicare claims for “unrelated, medically unnecessary, and expensive laboratory tests, including cancer genetic testing.” The DOJ’s charging nine of the defendants in this particular heist, which it says involved more than $29 million in phony billings.

The rest of the cases listed by the DOJ only get scummier from there. Five of the accused spent an unnamed sum that they’d pulled from the federal Provider Relief Fund on Las Vegas casinos and luxury cars, rather than the COVID-19 patients it was intended for. Nineteen are medical professionals who were charged with prescribing roughly 12 million doses of opioids and other highly addictive narcotics, while also submitting $14 million in phony billings on the backend. Another $133 million in false claims were allegedly submitted by defendants who were involved with a phony sober house that would bill residents for drug testing when it wasn’t medically required—“often billing thousands of dollars for a single test,” the DOJ said.

The remaining charges being made here mostly involve “more traditional categories,” of your health care fraud committed by more than 60 of the remaining defendants, according to the DOJ. They’re charged with submitting roughly $145 million in phony insurance claims for medical care that was “medically unnecessary and often never provided,” the Justice Department said.

It’s pretty rough seeing it all laid out like that, but the DOJ’s announcement lays bare what you likely already knew: that the global pandemic has left a lot of us sicker, sadder, and generally more desperate than we’ve ever been before, all while scoundrels get rich. Calvin Shivers, who helps direct the FBI’s Criminal Investigative Division, noted in his statement about the heist that these sorts of fraud schemes are explicitly designed are often targeted vulnerable populations. And if the country’s recent surge in covid-19 cases is any indication, the real, human cost from these scams will keep on surging right along with it.

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