Sep 30, 2020

Department of Justice Announces Multi-Billion Dollar Health Care Fraud Take Down Involving Telehealth Fraud, Residential Treatment Fraud and Opioid Fraud

On September 30th, Brian C. Rabbit, Acting Assistant Attorney General, Criminal Division, Department of Justice announced the largest ever nationwide healthcare fraud takedown.

As part of the takedown, the Department of Justice announced charges in 50 separate federal districts and the participation of over 40 different United States Attorney’s Offices, including offices in Pennsylvania, Ohio, Michigan, West Virginia, Maryland and New York. Charges were brought against a wide variety of individuals, including 50 doctors, 20 healthcare executives, and more than 100 medical professionals in total. The announced cases cover a wide variety of health care fraud and opioid prescription schemes, including schemes in which medical services were billed but not actually provided and/or were medically unnecessary.

The announced cases also involve schemes charged by the DOJ for the first time. The largest amount of fraud charged, totaling some $4.5 billion, involves telemedicine – i.e., the use of telecommunication services to provide healthcare services remotely. For example, charges were announced against a Northern District of Illinois doctor, who was the highest prescriber of genetic testing in the country, and is alleged to have caused approximately $145 million in allege fraud loss.

An additional $850 Million in charged fraud involves residential treatment centers, also known as “Sober Homes.” For example, a CEO, two clinic owners and three doctors gave been charged in connection with a $91 million fraud scheme involving Broward County, Florida in-patient and out-patient treatment facilities.

Charges were also announced involving doctors, lab owners and other individuals in connection with opioid medications. Schemes charged in the Northern District of Alabama and the Southern District of Ohio are alleged to have resulted in over $40 million in fraud involving the prescribing and distribution of 27,000,000 doses of opioids. Those charges were brought in collaboration with the DOJ’s Appalachian Regional Prescription Opioid Strike Force (ARPO). The Department of Justice’s press release may be found here.

Since April 2020, the Criminal Division and its law enforcement partners—including FBI, DEA, OIG-HHS, State Medicaid Fraud Task Forces and state and local law enforcement agencies—have charged over 300 individuals with health care fraud schemes involving more than $6 billion and millions of prescription opioid doses.

As additional information is learned about the individuals charged, Flannery | Georgalis will provide additional updates. Flannery | Georgalis’ team of former federal prosecutors and agents have significant experience in defending doctors, pharmacists, lab owners, health care executives in matters involving health care fraud charges.