Saturday, July 23, 2016

U.S. Says Florida Network Defrauded Medicare and Medicaid of Over $1 Billion

WASHINGTON — In the biggest health care fraud case the Justice Department has ever brought, prosecutors charged on Friday that the owner of a network of Florida nursing facilities orchestrated an elaborate scheme to defraud Medicare and Medicaid of more than $1 billion over the last 14 years.

The case cited allegations of bribes to Miami doctors, hush money to witnesses, and laundering of huge profits through shell companies, providing insight on a lucrative Medicare black market that has surfaced in the last decade.....indicting  the owner of the medical facilities, Philip Esformes, and two others. Mr. Esformes’s lawyer said on Friday that the businessman, who runs about 30 health care facilities in Florida and other states, “strongly asserts his innocence. Prosecutors, however, described him as the “mastermind” of a conspiracy that cycled some 14,000 elderly people in and out of nursing homes and assisted-living facilities, whether they needed medical care or not.With the help of doctors, pharmacists, health care consultants and other medical personnel who got kickbacks for their roles, the facilities billed Medicare and Medicaid for high-priced drugs, medical procedures and health equipment that the patients either did not need or never received, prosecutors said.

In some cases, they charged, Mr. Esformes’s operation “preyed upon” the elderly patients by giving them narcotics so that they would have to remain longer in the care facilities to treat their addictions and “the cycle of fraud could continue.”

Leslie R. Caldwell, who leads the Justice Department’s criminal division, said “This was a whole network of people scratching each other’s backs, paying kickbacks and giving each other referrals. “It shows what people can do when they’re determined to put their hand in the Medicare pot” including doctors and pharmacists.

Mr. Esformes has faced legal scrutiny before in Florida and Illinois over the operations of his nursing and assisted-living facilities. In 2006, he and his partners agreed to pay $15.4 million to settle a civil lawsuit brought by federal officials over accusations of Medicare fraud in the Miami area.

Information for this posting was taken from a July 23, 2016 posting in the New York Times. Susan Beachy contributed reporting.




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