HHS, DOJ Turn Up the HEAT* on Health Care Fraud, Recover $2.6 Billion

Health and Human Services Secretary Alex Azar and Attorney General Jeff Sessions today released a fiscal year (FY) 2017 Health Care Fraud and Abuse Control Program report showing that for every dollar the federal government spent on healthcare related fraud and abuse investigations in the last three years, the government recovered $4. Additionally, the report shows that the departments’ FY 2017 Takedown event was the single largest healthcare fraud enforcement operation in history.

hhs-doj-recover-$2.6 billion-in-health-care-fraudIn FY 2017, the government’s healthcare fraud prevention and enforcement efforts recovered $2.6 billion in taxpayer dollars from individuals and entities attempting to defraud the federal government and Medicare and Medicaid beneficiaries. Some of these fraudulent practices include:

  • Providers operating “pill mills” out of their medical offices.
  • Providers submitting false claims to Medicare for ambulance transportation services.
  • Clinics submitting false claims to Medicare and Medicaid for physical and occupational therapy.
  • Drug companies paying kickbacks to providers to prescribe their drugs, and pharmacies soliciting and receiving kickbacks from pharmaceutical companies for promoting their drugs.
  • Companies misrepresenting capabilities of their electronic health record software to customers.

The departments of Justice (DOJ) and Health and Human Services (HHS), through the Health Care Fraud Prevention and Enforcement Action Team (*HEAT) effort, use data analytics and surveillance to crack down on, prevent and prosecute healthcare fraud. While the program continues to be very successful, the return on investment fluctuates from year to year, in part because cases resulting in large settlements take multiple years to complete. Additionally, there has been a reduction in large monetary settlements as many of the large pharmaceutical manufacturers have entered into Corporate Integrity Agreements with the HHS Office of the Inspector General to establish protections against fraudulent activities.

With teams comprised of law enforcement agents, prosecutors, attorneys, auditors, evaluators and other staff, last year DOJ opened 967 new criminal healthcare fraud investigations of which federal prosecutors filed criminal charges in 439 cases involving 720 defendants.  A total of 639 defendants were convicted of healthcare fraud related crimes. In FY 2017, the DOJ and HHS joint Medicare Fraud Strike Force filed 253 indictments and charges against 478 defendants who allegedly billed federal healthcare programs more than $2.3 billion. The Strike Force obtained more than 290 guilty pleas, litigated 33 jury trials and won guilty verdicts against 40 defendants. The Fraud Strike Force secured prison sentences for more than 300 defendants, with an average sentence of 50 months. Since its inception in 2007, Strike Force prosecutors filed more than 1,660 cases charging more than 3,490 defendants who collectively billed the Medicare program more than $13 billion.

“Today’s report highlights the success of HHS and DOJ’s joint fraud-fighting efforts,” said HHS Secretary Azar. “By holding individuals and entities accountable for defrauding our federal health programs, we are protecting the programs’ beneficiaries, safeguarding billions in taxpayer dollars, and, in the case of pill mills, helping stem the tide of our nation’s opioid epidemic.”

“Taxpayers work hard every day to help fund government programs for our fellow Americans,” Attorney General Sessions said. “But too many trusted medical professionals like doctors, nurses and pharmacists have chosen to violate their oaths and exploit this generosity to line their pockets, sometimes for millions of dollars.  At the Department of Justice, we have taken historic new actions to incarcerate these criminals and recover stolen funds, including executing the largest healthcare fraud enforcement action in American history.  These achievements are important, but the department’s work is not finished. We will keep up this pace and continue to prosecute fraudsters so that we can give financial relief to taxpayers.”

As FierceHealthcare reported, however, the total was down almost 21 percent from the prior year’s $3.3 billion recovered.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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