How To Report Medicare Fraud

Fraudulent billing practices by medical professionals and hospitals result in billions of dollars in lost tax funds annually. There are a wide variety of practices used that result in medical providers effectively stealing public funds including billing for medical procedures that are not needed, inflated (i.e. padded) billing, double billing, the practice of upcoding, billing for medical equipment that has been returned or never provided, kickbacks and manipulation of outlier payments. These types of fraudulent practices result in billions of dollars per year in lost taxpayer dollars and can be extremely difficult to expose without the assistance of an insider like a nurse, billing administrator, physician or other medical professional with evidence and knowledge of the fraudulent billing practices.

If you have knowledge of these types of fraudulent billing practices, you are certainly in a difficult position because you may be afraid that if you expose these fraudulent billing practices you may suffer retaliation from your employer including termination. It is even possible that you are afraid that you will find it difficult to find new employment because your current employer may blacklist you with other hospitals or medical practices. Fortunately, the Federal False Claims Act provides brave and conscientious employees who expose unethical and illegal practices that result in the theft of billions of dollars in taxpayer funds annually with protection from such retribution. Another reason to disclose these practices is that remaining quiet may expose you to potential criminal and civil liability. The government is becoming increasingly aggressive in prosecuting those who commit Medicare fraud. The government will not only pursue your employer but you too may be liable for failing to report Medicare fraud.

Because Medicare fraud cheats the government out of billions of dollars in public funds, a person who brings a Qui Tam lawsuit under the Federal False Claims Act and exposes fraudulent Medicare billing practices is compensated with up to 30 percent of the potential recovery. If you know that a medical office, medical professional or hospital is committing Medicare fraud, our experienced whistleblower claims attorneys help heroic citizens who expose these illegal schemes by filing a Qui Tam lawsuit. The reason that whistleblowers are so critical in exposing these fraudulent billing schemes is that the Medicare process usually results in little scrutiny for fraud prior to paying submitted billings.

The federal government has increased efforts to expose Medicare fraud resulting in recovering over $2.5 billion in Medicare overpayment in a recent twelve-month period. During 2009, the federal government recovered $1.63 billion in through negotiated settlements and judgements while 1,014 new health care fraud investigations were initiated involving 1,786 defendants. Courageous citizens who step forward and provide evidence of these fraudulent billing practices are an indispensable element in protecting the public from having hard earned tax dollars stolen resulting in a need to increase revenue, which may include tax increases, or cost cutting of vital Medicare benefits.

The HCA Inc (The Healthcare Company) case is a good example of the scope of recovery both for the government and the Qui Tam claimant (called the “Relator”) in a Qui Tam lawsuit. The company agreed to repay the government $1.7 billion in a Qui Tam lawsuit for fraudulent billing of Medicare and other federal health care programs. The whistleblowers that exposed the fraudulent billing practices and brought the Qui Tam lawsuit received over $150 million dollars for exposing the conduct of the company that cheated taxpayers.

While the relator initiates a Medicare Qui Tam lawsuit under the False Claims Act, the lawsuit is initially filed under seal for sixty days so that the Department of Justice (DOJ) can determine if it wants to intervene and prosecute the Qui Tam case. The relator will still receive a percentage of the recovery if the DOJ decides to intervene. The percentage recovered by the relator ranges from 15-30 percent based on whether the government intervenes and takes over prosecution of the case. If the government does not intervene during the sixty day period, the relator may continue to pursue the claim, and the exact percentage received as a reward by the relator in the Qui Tam lawsuit will depend on the significance of the relator’s role and level of assistance.

The Medicare Qui Tam claims attorneys at Barrett Law PLLC represent patriotic citizens who expose illegal theft of public funds and protect taxpayers. We assist clients who have evidence of Medicare fraud in bringing Qui Tam lawsuits to expose this illegal activity and protect the public. Barrett Law PLLC recognizes the essential function of those who come forward despite fear of retribution to reveal Medicare fraud and recover vital public funds. We represent whistleblowers throughout The United States who initiate Qui Tam prosecutions in complying with the procedures of bringing a Qui Tam claim and handling the litigation if the government does not intervene so call us today at 662-834-2376.

“All that is necessary for the triumph of evil is that good men do nothing.” (Edmund Burke)

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Texas Doctor Indicted in $375 Million Health Care Fraud Scheme

The Justice Dept. has charged a Texas physician with bilking the government to the tune of nearly $375 million in what it says is the single-largest health fraud scheme exposed in the nation’s history.

Emergency physician Jacques Roy, MD, is accused of recruiting fake patients to sign for medical treatments he never provided, then billing Medicare and Medicaid for the care. Dr. Roy, 54, owned and operated Dallas-based Medistat Group Associates P.A., an association of health professionals that provided home health certifications and patient home visits, according to the Justice Dept.

Between January 2006 and November 2011, Medistat certified more Medicare beneficiaries than any other medical practice in the country, the Justice Dept said in a statement. These certifications allegedly resulted in $350 million being billed to Medicare and more than $24 million being billed to Medicaid by Medistat and associated home health agencies for care that never was provided.

“The conduct charged in this indictment represents the single-largest fraud amount orchestrated by one doctor in the history of … our Medicare Fraud Strike Force operations,” said U.S. Deputy Attorney General James Cole. “Thanks to the historic partnerships we’ve built to combat health care fraud, we are sending a clear message: If you victimize American taxpayers, we will track you down and prosecute you.”

Dr. Roy and other Medistat physicians allegedly certified and recertified plans of care so home health agencies were able to bill Medicare for home health services that neither were medically necessary nor provided. Dr. Roy also allegedly performed unneeded home visits and ordered unnecessary medical services as part of the scam. Home health agency employees working with Dr. Roy are accused of visiting homeless shelters and encouraging residents to sign bogus health care forms. Recruiters were paid $50 for each person they persuaded to sign the forms, according to the Justice Dept.

Dr. Roy is charged with one count of conspiracy to commit health care fraud and nine counts of substantive health care fraud. If convicted on all counts, he would face up to 100 years in prison. In addition to charges against the physician and his staff members, the Centers for Medicare & Medicaid Services has suspended billing privileges for 78 home health agencies associated with the alleged fraud.

New technology could prevent fraud

Meanwhile, recent federal investments in predictive modeling technology to fight Medicare fraud have led to millions of dollars being returned to the program, officials said.

CMS launched its fraud prevention system by July 2011, and predictive analytics are being used across the Medicare program. The effort has cost $77 million. The technology analyzes billing patterns and flags suspicious activity for billing denials and further investigation.

The Senate Homeland Security and Governmental Affairs Committee questioned the effectiveness of the system in a Dec. 19, 2011, letter signed by Sens. Tom Carper (D, Del.), Orrin Hatch (R, Utah) and Tom Coburn, MD (R, Okla.). In a Jan. 27 reply, CMS Center for Program Integrity Director Peter Budetti, MD, insisted that the new measures have improved the way the Medicare agency detects fraud.

“For the first time, CMS has a real-time view of fee-for-service claims across claim types and the geographic zones of its claims processing contractors,” Dr. Budetti said. “CMS can now more easily identify fraudulent providers by detecting patterns and aberrancies.”

The Medicare agency still is trying to gauge the full impact of its fraud prevention technology, Dr. Budetti said. By Nov. 30, 2011, the system had prevented $1.6 million in improper Medicare payments through prepayment audits that trigger automatic denials.

Predictive modeling also has been successful in identifying nine instances of fraudulent billing between July and November 2011. Those investigations led to the return of $2.2 million. By the end of 2011, CMS contractors had started 437 investigations based on leads generated by the system.

However, the total amounts are small compared with overall improper payments in Medicare. CMS estimated a total of $34.3 billion in improper payments from the fee-for-service program in 2010.


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Hospital Assistant Administrator Guilty of $116 Million In Fake Claims

The FBI has announced today that an assistant administrator from a Texas hospital pleaded guilty to scheme to fraud $116 million from Medicare by submitting false and  unnecessary claims for mental health treat.

Mohammad Khan, 62, of Houston, made his plea before  U.S. District Judge Sim Lake to various counts of health care fraud, payment and receipt of illegal health care kickbacks, and defrauding the United States. The plea was made in the Southern District of Texas court, due to his Feb. 8, 2012 arrest.

Since January 2008 through January 2012, Khan had submitted $116 million worth of fraudulent claims to Medicare for “partial hospitalization program (PHP) services purportedly provided by the hospital,” for intensive outpatient treatment for severe mental illness.

“As an assistant administrator at a Houston hospital, Mr. Kahn participated in a $116 million fraud against the government,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “For years, he operated a scheme to bill Medicare for partial hospitalization services that were medically unnecessary or never provided.”


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Owner and Employee of Miami Home Health Company Plead Guilty in $22 Million Health Care Fraud Scheme

WASHINGTON – The owner and an employee of a Miami health care agency pleaded guilty for their participation in a $22 million home health Medicare fraud scheme, the Department of Justice, the FBI and the Department of Health and Human Services (HHS) announced today.

Marietha Morales, 38, pleaded guilty on Jan. 24, 2012, before U.S. District Judge Seitz to one count of conspiracy to commit health care fraud and Eduardo Saborit-Dominguez, 48, pleaded guilty today before Judge Seitz to one count of conspiracy to violate the Anti-Kickback Statute. Sentencing for both defendants is scheduled for May 23, 2012.  The charge of conspiracy to commit health care fraud carries a maximum prison sentence of 10 years.

According to the court documents, Morales was the president and Saborit-Dominguez was an employee of Prime Home Health Services Inc., a Florida home health agency that purported to provide home health care and physical therapy services to eligible Medicare beneficiaries.

According to plea documents, Morales conspired with patient recruiters for the purpose of billing the Medicare program for unnecessary home health care and therapy services. Morales and her co-conspirators paid kickbacks and bribes to patient recruiters in return for these recruiters providing patients to Prime Home Health, as well as prescriptions, plans of care and certifications for medically unnecessary therapy and home health services for Medicare beneficiaries. Saborit-Dominguez distributed the kickbacks and bribes to co-conspirator patient recruiters and knew that the payment of kickbacks and bribes was in violation of federal criminal laws. Morales used these prescriptions, plans of care and medical certifications to fraudulently bill the Medicare program for home health care services, which Morales knew was in violation of federal criminal laws.

According to plea documents, at Prime Home Health, nurses and office staff falsified patient files for Medicare beneficiaries to make it appear that such beneficiaries qualified for home health care and therapy services from Prime Home Health. Morales admitted that she knew the beneficiaries did not actually qualify for and did not receive such services. Morales knew that these files were falsified so that the Medicare program could be billed for medically unnecessary therapy and home health related services.

From approximately February 2005 through April 2011, Morales and her co-conspirators submitted approximately $22 million in false and fraudulent claims to Medicare and Medicare paid approximately $14 million on those claims.

The plea was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.

This case is being prosecuted by Trial Attorney Joseph S. Beemsterboer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Miami.

Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,140 defendants who collectively have falsely billed the Medicare program for more than $2.9 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.


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3 Arrested in $90 Million Medicare Fraud Scheme

The owners of a Houston mental health program were arrested Wednesday, charged with trying to bilk Medicare out of $90 million for treatments that amounted to little more than patients “watching movies, playing bingo or engaging in other activities,” federal authorities contend.

Mansour Sanjar, 78, and Cyrus Sajadi, 64, both physician owners of Spectrum Care in West Houston were charged in the alleged phony treatment scheme, which involved kickbacks to the owner of an assisted living facility in exchange for finding and funneling patients to the clinic.

Chandra Nunn, 33, the owner of the home, also was arrested Wednesday. All three are charged with conspiracy to commit health care fraud and conspiracy to pay and receive illegal health care kickbacks. Since 2006, Center and Sajadi had been submitting bills to Medicare for supposed treatment at their “partial hospitalization program,” known as a PHP.

The arrests come just two months after a Houston Chronicle investigation uncovered hundreds of millions in Medicare dollars spent to shepherd mentally fragile Texans by ambulance to mental health clinics and PHPs where patients claimed they watched TV and ate junk food.

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Mission Pharmacists Accused of Medicaid Fraud Conspiracy

McALLEN — Federal authorities arrested a Mission pharmacist and an employee in an alleged health care fraud conspiracy that purportedly netted more than a half million dollars from state and private insurance programs.

FBI agents arrested Sara Elicia Garza, 55, and Valerie Jean Flores, 38, on charges of health care fraud and conspiracy to commit health care fraud.

Garza is a pharmacist and owner of Sara’s Pharmacy and Gift Corner, 1300 S. Bryan Road, Mission. Flores was a senior pharmacist who worked alongside Garza.

An indictment unsealed Friday accuses Garza of conspiring to defraud the Texas Medicaid/Vendor Drug program and Humana Insurance. The indictment also says Garza filed false and fraudulent claims to the state’s Medicaid drug program seven times, as well as five other false claims to Humana insurance.

Flores faces one count of conspiracy and seven counts of filing false claims to the state’s Medicaid drug program.

Beyond the state Medicaid drug program and Humana, prosecutors said Garza and Flores submitted false claims to insurance companies Blue Cross/Blue Shield and Caremark.

The false claims involved prescription drugs that were never dispensed, prosecutors said. In other instances, the pharmacists prescribed drugs to treat medical conditions their “patients” never had.

To cover up the fraudulent billings, Garza and Flores forged doctors’ signatures on prescriptions and forged patients’ signatures on billing forms and on logs that were supposed to confirm the patient had received medications, prosecutors said.

In all, the state’s Medicaid drug program paid more than $461,951 in fraudulent claims for medicine never given to patients, prosecutors said. Humana purportedly lost more than $78,711 from fake claims, as well.

Sara’s Pharmacy received more than $540,663 between November 2006 and June 2011 from the false claims, prosecutors said.

Both made appearances before U.S. Magistrate Judge Dorina Ramos on Friday and were released on bond. An arraignment is set for Wednesday.

The indictment comes after a July 2011 raid at the pharmacy by FBI agents and investigators with the Texas Attorney General’s Medicaid fraud unit.

The pharmacy closed last month, but its gift shop remains operational. A phone call to the shop Friday afternoon went unanswered.

Information about the case, including defense attorneys’ names, had not been posted with the federal courts online filing system Friday afternoon.

Each of the 15 counts in the indictment carries a maximum sentence of 10 years in prison and up to a $250,000 fine.


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How to Spot & Report Medicare Fraud

What Is Fraud & Abuse?

Medicare fraud happens when Medicare is billed for services or supplies you never got. Medicare fraud costs Medicare a lot of money each year.

Abuse occurs when doctors or suppliers don’t follow good medical practices, resulting in unnecessary costs to Medicare, improper payment, or services that aren’t medically necessary.

How to Spot & Report Fraud

Spotting Fraud

When you get health care services, record the dates on a calendar and save the receipts and statements you get from providers to check for mistakes. Compare this information with the claims Medicare processed to make sure you or Medicare weren’t billed for services or items you didn’t get.

3 Ways to Review Your Original Medicare Claims

  1. Look at your Medicare Summary Notice (MSN).
  2. Visit
  3. Call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.

Reporting Fraud

If you think a charge is incorrect and you know the provider, you may want to call their office to ask about it. The person you speak to may help you better understand the services or supplies you got. Or, your provider may realize a billing error was made.

If you’ve contacted the provider and you suspect that Medicare is being charged for a service or supply you didn’t get, or you don’t know the provider on the claim, call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048

3 Tips for Fighting Fraud

You can help stop dishonest people by identifying and reporting cases of potential fraud.

3 easy things you can do to fight fraud:

  1. Review your Medicare claims to make sure they are accurate. Check them early — the sooner you see and report errors, the sooner we can stop fraud.
  2. Learn how to protect your personal information.
  3. Be on the lookout for suspicious activity.

Learn more about protecting yourself and spotting fraud at or by visiting the local Senior Medicare Patrol office in your area.

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Whistleblower in Maxim Case is Role Model for Fraud Detection

Something didn’t look right. Maxim Healthcare nurses were showing up at Richard West’s house according to one schedule. But Maxim was billing the government according to another.

West complained to the state: The company was charging for hundreds of hours of work it never did. Officials blew him off, he said. He alerted Medicaid, the state and federal program that paid for his care. Nothing happened.

He told a social worker. She expressed concern, but did nothing. But West, a Vietnam vet with muscular dystrophy, kept pushing and pushing, building a giant, accusatory snowball that landed last week — eight years later — on Maxim’s Columbia headquarters.

Maxim has signed a criminal and civil settlement related to allegations that it schemed to rip off $61 million from state and federal governments, law enforcement authorities said last week. The company is paying $150 million in penalties and recompense. Eight former Maxim employees so far have pleaded guilty to felony charges in several states.

If Washington is as serious about fighting medical fraud as it pretends to be, it will recruit an army of Richard Wests to burn off leeches like Maxim. Nobody is in a better position to see fraud than patients, who can check the care they receive against what’s on the invoice.

Now that West has shown that patients can get rich in the bargain, there’s plenty of incentive. Not that his motivation was his $14.8 million share of the settlement. Anger was. He didn’t even know about such whistleblower rewards at first.

“Somebody decided to make a profit on my disability,” West said in a telephone interview. “This is your country. You see fraud, you should turn them in. That is part of being an American.”

Whistleblower rewards under the federal False Claims Act have been around since the Civil War. The recent caseload has been dominated by allegations of Medicare and Medicaid fraud, which costs taxpayers billions of dollars a year.

In almost every instance, the person who alerts law enforcement is a corporate insider, not a patient. West’s information in the Maxim case was so compelling, however, that the government credited him as the “original source,” with independent and direct knowledge of the fraud.

He kept spreadsheets on the gaping discrepancy between the hours Maxim nurses spent in his home north of Atlantic City, N.J., and the hours Maxim billed Medicaid. Eventually he documented more than 700 hours of bogus charges, according to the New Jersey attorney general.

After a couple months of detective work, West got in touch with Baltimore lawyer Robin Page West (no relation), who specializes in whistleblower lawsuits. Together they built a case, filed it under court seal in 2004 and turned it over to law enforcement. And waited.

West, 63, speaks precisely but with difficulty, in a high-toned voice. He says he commanded an Army track vehicle with 40 mm guns in Vietnam in 1968 and 1969 — the deadliest years of the war there. Yet biding his time while investigators built their file, he said, “was the hardest thing I’ve ever done.”



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Maxim Healthcare Reaches $150 Million Fraud Settlement

(Reuters) – Maxim Healthcare Services Inc, a home health-care services company, has agreed to pay $150 million to resolve allegations it defrauded U.S. government benefits programs.

The settlement, announced Monday by the Department of Justice and New Jersey state authorities, resolves criminal and civil charges that the privately held company defrauded Medicaid and Veterans Affairs healthcare programs.

Maxim, based in Columbia, Maryland, was accused of submitting false claims for services it did not provide or that were improperly documented. It was also accused of operating offices that were not properly licensed.

Maxim settled with the U.S. Department of Justice and 41 states. The company entered into a deferred prosecution agreement with the Justice Department under which it will pay a $20 million fine.

If Maxim meets the agreement’s requirements, it will avoid charges. The government said it was willing to enter into the agreement with Maxim in part because of its cooperation and significant personnel changes it has made since 2009.

“We take full responsibility for these events set forth in the deferred prosecution agreement and we are pleased to reach a settlement that will allow us to move forward with the important work of caring for our patients and clients who depend on us each and every day,” Maxim Chief Executive Officer Brad Bennett said in a statement.

About $121.5 million of the settlement will be allocated to the Medicaid program, and approximately $8.5 million to the Veterans Affairs program.

According to a criminal complaint filed in connection with the agreement, Maxim submitted more than $61 million in fraudulent bills to Medicaid and the Veterans Affairs program.

“Maxim, including senior executives, defrauded a system providing needed services to turn money meant for patient care into corporate profits,” said acting New Jersey U.S. Attorney J. Gilmore Childers in a statement.

The New Jersey U.S. Attorney’s Office said that to date, nine people – eight former Maxim employees, including three senior managers, and the parent of a former Maxim patient – have pleaded guilty in connection with the fraud.

The three former senior managers are Gregory Munzel, Bryan Lee Shipman, and Matthew Skaggs.

Munzel pleaded guilty in 2009 to one count of making false statements relating to health-care fraud matters. He is set to be sentenced Sept. 29.

Shipman pleaded guilty to one count of healthcare fraud last year. He is scheduled to be sentenced Nov. 16.

Skaggs pleaded guilty to making false statements relating to health care fraud matters last year. He was sentenced on June 10, to three years’ probation and ordered to pay a $4,000 fine.

The criminal case against the company is U.S. District Court, District of New Jersey, United States of America v. Maxim Healthcare Services Inc, 11-6107.


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CMS Has New Software to Detect Fraudulent Medicare Claims

The Centers for Medicare & Medicaid Services (CMS) is introducing predictive modeling technology as part of the Obama Administration’s effort to reduce the estimated $60 billion that government health care programs lose each year due to fraud and abuse. The CMS predictive modeling program is authorized by Section 4241 of the Small Business Jobs Act of 2010 (the “Act”). The software will evaluate all incoming Medicare fee-for-service (FFS) claims for factors suggesting potential fraud or abuse. The Act allows CMS to avoid Medicare’s statutory prompt payment requirement when blocking reimbursement of claims flagged by the system for further review.

Private health insurance companies, banks, and credit card issuers already use similar software to detect fraud in their claims systems. Analysts expect that CMS’ predictive modeling software will share some characteristics of existing private sector applications. The CMS fraud-detection model may incorporate the following factors already in use by the software of commercial health insurance companies:

  • Improper “unbundling” of services that should be billed as one procedure, but instead are charged as multiple, individual procedures.
  • “Upcoding,” or utilizing reimbursement codes for services with higher reimbursement rates than the rates of the services actually rendered.
  • Claiming a high percentage of provider workdays that exceed eight hours in length.
  • Claiming a recent increase in weekends worked by providers.
  • Increase in service lines billed across multiple patients and multiple claims.
  • Increase in the use of claim line modifiers.1

Investigators will review medical records and other information associated with the records that are flagged as potentially fraudulent by the software. Legitimate claims are to be paid promptly. Claims requiring further review may be referred to the Health Care Fraud Prevention and Enforcement Action Team, a joint venture between the Department of Health and Human Services and the Department of Justice dedicated to prosecuting health care fraud.

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