More Than $50 Million in Intended Health Care Fraud Losses Charged
LOS ANGELES – In coordination with the Vice President’s Task Force to Eliminate Fraud, eight defendants, including three nurses, a chiropractor, and a psychologist, have been arrested on federal charges that they schemed to defraud the nation’s health care system out of more than $50 million – including by running sham hospice care facilities that bilked Medicare by using people without terminal illnesses as beneficiaries, the Justice Department announced today.
Six of the defendants arrested today are expected to make their initial appearances this afternoon in United States District Court in downtown Los Angeles. One defendant is expected to make his initial appearance in U.S. District Court in Idaho. One defendant was arrested Tuesday and made his initial appearance in Los Angeles federal court.
“We are enforcing a zero-tolerance policy for criminals who defraud American taxpayers,” said First Assistant United States Attorney Bill Essayli. “The defendants arrested this morning who are charged with stealing millions of dollars of health care benefits got caught and now face years in federal prison.”
“The Southern California region is a high-risk environment for hospice-related and many other forms of health care fraud,” said Akil Davis, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “The United States loses hundreds of billions of dollars annually to healthcare fraud at the expense of all American taxpayers, whose benefits decrease as premiums, co-payments and taxes grow. Our aim is to reverse that trend with ‘Operation Never Say Die’ and others like it.”
“The defendants charged today allegedly turned hospice care into a cash producing operation, resulting in more than $50 million in losses to taxpayers. The magnitude of the losses underscores a deliberate abuse of the authority and trust afforded to health care providers,” said Inspector General T. March Bell of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). “Today’s takedown reflects HHS-OIG’s commitment to deploy every tool at our disposal, and collaborate with our law enforcement partners, to dismantle hospice operations built on deception. Anyone who seeks to weaponize hospice care to bilk Medicare should expect to be held accountable.”
“Today’s arrests are another decisive strike in our war on fraud,” said U.S. Department of Labor Inspector General Anthony P. D’Esposito. “My office is relentlessly pursuing those who target union benefit plans and exploit employee healthcare programs for personal gain. Working side-by-side with the FBI, the Department of Labor’s Employee Benefits Security Administration, and our law-enforcement partners, we are aggressively dismantling fraud schemes and taking down those who exploit American workers. Let this be a warning: If you steal from workers or taxpayers, your time is up. We will find you, investigate you, and hold you accountable.”
“When employee benefit plans become targets for fraud, it’s not just the plans that are hurt – everyday working Americans who earned those benefits honestly, their families, and the communities they live in are hurt,” said Robert Prunty, Acting Regional Director U.S. Department of Labor Employee Benefits Security Administration’s Los Angeles Regional Office. “In the Trump Administration, we will relentlessly seek out fraud and ensure those responsible are brought to justice.”
“Health care fraud undermines federal programs, threatens public trust, diverts resources away from legitimate patient care, and is a calculated attack on programs meant to protect the vulnerable,” said Tyler Hatcher, Special Agent in Charge, IRS‑CI Los Angeles Field Office. “The enforcement actions taken today demonstrate IRS‑CI’s commitment to uncovering the financial lies behind these schemes and holding accountable those who profit at the expense of taxpayers and patients. Our agents will continue to work alongside our law‑enforcement partners to protect the integrity of our healthcare system and ensure that those who abuse it are brought to justice.”
