28 Indicted in Texas Medicare Fraud Crackdown

It is nearly impossible to turn on the news these days and not hear a story about troubles in the Medicare system. As the population ages, the federal government is becoming increasingly strapped for the cash it needs to pay for elderly Americans' medical care.

As a result, the government is doing everything it can to identify and eliminate waste in the system. Suspected acts of Medicare fraud are its biggest target.

Recently, the government's Medicare Fraud Strike Force came to Texas as part of an enforcement sweep in seven cities throughout the United States. Agents indicted 28 people. It is alleged that the Texans were responsible for approximately $261 million in fraudulent Medicare billings.

The indictments involved several false billing schemes. In the largest one, a doctor and a home health agency are accused of working together to submit approximately $100 million worth of fraudulent bills for reimbursement. According to the indictment, during a four-year period, the doctor signed approximately 33,000 prescriptions for 2,000 different Medicare patients. Authorities say the doctor's practice was to sign stacks of documents without ever reviewing them.

The indictments centered on a kickback scheme in which hospital administrators paid patients - often with cigarettes or gift shop coupons - to attend a partial hospitalization program for patients with mental illnesses. The indictment alleges that the patients did not actually receive treatment, but instead spent most of their time playing games and watching television. All told, the administrators are accused of generating approximately $158 million in fraudulent revenues through the scheme.

Understanding Medicare Fraud

While these two cases present very high-profile examples of Medicare fraud, it is important to understand that even small operations are taken seriously. Understanding what Medicare fraud is can help health care operations avoid inadvertent illegal behavior and identify employees who may be engaged in fraud or abuse.

Medicare fraud exists whenever a person or organization makes false statements or representations of fact to obtain benefits that they would not otherwise be entitled to receive. Some of the most common types of Medicare fraud include:

  • Billing for services or supplies that were not actually provided
  • Billing for services or equipment that were provided, but not medically necessary
  • Changing receipts or claim forms to get a higher payment
  • Billing for home medical equipment that was returned by the patient
  • Using another person's Medicare to provide reimbursement for a patient who is not covered by the program

The penalties for Medicare fraud and abuse can be quite severe. Fraudulent health care providers can be held civilly liable under the False Claims Act. In addition to penalty fines, they could be required to pay financial damages up to three times the value of the government's loss. Moreover, health care providers can be charged under a number of criminal laws, many of which carry the possibility of spending several years in prison.

Health care providers should never make the mistake of taking allegations of fraud lightly. If you are concerned about possible Medicare fraud or abuse at your organization, talk to a Texas health care law attorney who can help you understand your options.

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