You can run but not hide

[Steve Verno]

94 charged in Medicare scams totaling $251M
By KELLI KENNEDY and TOM HAYS, Associated Press Writers

MIAMI –

Elderly Russian immigrants lined up to take kickbacks from the backroom of a Brooklyn clinic. Claims flooded in from Miami for HIV treatments that never occurred. One professional patient was named in nearly 4,000 false Medicare claims.

Authorities said busts carried out this week in Miami, New York City, Detroit, Houston and Baton Rouge, La., were the largest Medicare fraud takedown in history — part of a massive overhaul in the way federal officials are preventing and prosecuting the crimes.

In all, 94 people — including several doctors and nurses — were charged Friday in scams totaling $251 million. Federal authorities, while touting the operation, cautioned the cases represent only a fraction of the estimated $60 billion to $90 billion in Medicare fraud absorbed by taxpayers each year.

That world is coming to an end," Health and Human Services Secretary Kathleen Sebelius told The Associated Press after speaking at a health care fraud prevention summit in Miami. "We've got new ways to go after folks that we've never had before."

Officials said they chose Miami because it is ground zero for Medicare fraud, generating roughly $3 billion a year. Authorities indicted 33 suspects in the Miami area, accused of charging Medicare for about $140 million in various scams.

Suspects across the country were accused of billing Medicare for unnecessary equipment, physical therapy and other treatments that patients never received. In one $72 million scam at Bay Medical in Brooklyn, clinic owners submitted bogus physical therapy claims for elderly Russian immigrants.

Patients, including undercover agents, were paid $50 to $100 a visit in exchange for using their Medicare numbers and got bonuses for recruiting new patients. Wiretaps captured hundreds of kickback payments doled out in a backroom by a man who did nothing but pay patients all day, authorities said.

The so-called "kickback" room had a Soviet-era propaganda poster on the wall, showing a woman with a finger to her lips and two warnings in Russian: "Don't Gossip" and "Be on the lookout: In these days, the walls talk."

With the surveillance, the walls "had ears and they had eyes," U.S. Attorney Loretta Lynch said at a news conference in Brooklyn.

In a separate Brooklyn case, authorities charged six patients who shopped their Medicare numbers to various clinics. More than 3,744 claims were submitted on behalf of one woman alone, 82-year-old Valentina Mushinskaya, over the past six years.



A new joint effort by HHS and the Department of Justice enables law enforcement to view Medicare claims in real time and flag suspicious patterns. More stringent screening methods, including more comprehensive background checks, have also been put in place. The agency gets roughly 18,000 applications daily to become a Medicare provider. Now they can put a moratorium on new applications in certain areas, like physical therapy, if they notice a spike in fraudulent activities.

The changes are paying off.

Investigators visited 1,600 providers in Miami in the past few months, making sure legitimate businesses were operating at the addresses. In 2008, authorities required all medical equipment providers in Miami to apply for new certification, hoping the paper hurdle would deter scammers. The number of claims dropped by $1.6 billion.