Federal agents charged 44 people in New York, Los Angeles, Atlanta and Miami in what they’re calling the single largest Medicare fraud scheme ever, according to the U.S. Dept. of Justice.
The individuals allegedly set up 118 phantom clinics in 25 states and stole the identities of doctors and thousands of Medicare beneficiaries, intending to submit phony claims.
The charges were filed in federal court in New York. The Mirzoyan-Terdjanian international organized crime syndicate is believed to back the alleged scheme. The group has members in the U.S. and Armenia, according to a Justice Dept. press release. Outside the organized crime group, a lawyer and several doctors were among 18 other individuals charged in connection with the alleged fraud.
The group had allegedly netted $35 million from false Medicare claims which it transferred overseas, according to authorities, and had billed the federally funded payer for at least $100 million.
It was the latest in a series of healthcare fraud busts by the Dept. of Justice. In July, federal authorities charged 94 individuals for allegedly submitting $251 million in false claims through multiple schemes in five states.
The latest scandal may add more fuel to Sen. Charles Grassley’s (R-Iowa) claim that the Center for Medicare and Medicaid Services is too lax in policing its contractors. The senator sent a strongly-worded letter last week to Dr. Donald Berwick, head of the Centers for Medicare and Medicaid, and his boss Kathleen Sebelius, secretary of the U.S. Dept. of Health & Human Services, asking how CMS watches over the contractors it uses to process Medicare claims and those charged with finding and eliminating fraud and waste.
The Affordable Care Act included $500 million to put more FBI and HHS agents and prosecutors onto the task force and stipulated better information sharing across agencies. The healthcare overhaul also included more severe penalties for those convicted of Medicare fraud and forced more scrutiny of the durable medical equipment industry, which is frequently used for false up-coding in Medicare fraud cases.