Good congresswoman Jackson Lee again rode to the hospital's rescue. "Even if more harmful acts prove to be true," she wrote to CMS, "an entire institution should not be penalized by the acts of one person."

In Riverside's case, that "one person" would abruptly multiply. Khan ratted out CEO Earnest Gibson III as his co-conspirator. The feds also nabbed Gibson's 35-year-old son, Earnest IV. He ran one of the psychiatric clinics and was charged with billing nearly $700,000 for care that "was not medically necessary and, in some cases, not provided," according to prosecutors.

Investigators discovered that, since 2005, the hospital had been swindling the feds to the tune of $22 million a year. Khan pleaded guilty. The two Gibsons and five others await trial on charges of fraud, conspiracy, and money laundering.

Gov. Rick Scott was CEO of a hospital company nailed with two sets of books. Then he went into politics.
Gage Skidmore
Gov. Rick Scott was CEO of a hospital company nailed with two sets of books. Then he went into politics.
Christopher Dennis and Reginald France work out of the Miami-area HEAT task force office.
Liliana Mora
Christopher Dennis and Reginald France work out of the Miami-area HEAT task force office.

Jackson Lee refused to comment for this article.


Housed in a featureless building north of Miami, the HEAT Task Force is a government anomaly: It actually turns a profit.

For every dollar it spends investigating, it uncovers another $8 in fraud. Most agents work out on the street, assigned to about a dozen cases each.

In 2007, the government finally grasped the scope of all the stealing and got serious about trying to stop it. The Department of Justice launched Medicare Fraud Strike Forces in Miami and Los Angeles. Those were supplemented with HEAT teams (HEAT is short for the windy governmentese of Health Care Fraud Prevention and Enforcement Action Team) in 2009. This group — an interagency initiative combining members of the Justice Department and Health and Human Services — has branches in nine cities where the stealing is most prolific, such as Los Angeles, Houston, New York, Dallas, and Baton Rouge. Agents and prosecutors work in small, aggressive teams, combining data analysis with traditional detective work.

Since 2007, prosecutors have charged 1,480 defendants with $4.8 billion in fraud. More than half of those indictments came out of the unit in Miami, a city that Special Agent in Charge Christopher Dennis calls "the crown jewel of Medicare fraud." Miami was the MIT of health-care schemes, the nation's unofficial laboratory for ripping off the government. "A lot of the schemes are typically started here — vetted, proven here — and farmed out to other parts of the country," Dennis said.

At first, the Justice Department mostly tackled companies that sold medical equipment — scams involving wheelchairs, hospital beds, respiratory devices, and the like. Lax oversight allowed these businesses to pop up overnight, bill Medicare for hundreds of thousands of dollars, then disappear just as quickly — only to reemerge elsewhere under a new name. Often, perpetrators had fled the country with the stolen funds before indictments could come down.

Hank Walther was a federal prosecutor who led the feds' Medicare Fraud Task Force. He feels they were allowing their adversaries to run scot-free.

"My 4-year-old kid could prosecute these cases," he says of the equipment rackets. "They're really easy, and there are plenty of them. A lot of this other stuff — home health, the ambulatory cases, even the mental-health cases — each time we got into those new areas, there was a constant refrain from law enforcement and the U.S. Attorney's Office saying, 'This is too complicated.' "

The feds started teaming prosecutors with detectives in the same approach used to break down organized crime. They began to hunt providers, whose fraud ran to the tens of millions compared with the $1 million to $2 million paydays from equipment scams.

"When you look per capita, Miami has more people in community mental-health centers than New York and Los Angeles combined," says Walther. "Then you look at the profile of people going in there, and they don't really fit people that need these services."

In 2010, Walther helped take down American Therapeutic, the highest-billing mental-health center in the country. The company was cycling addicts, alcoholics, and Alzheimer's patients through its six clinics. Patients' diagnoses were changed so they would qualify for expensive group therapy. In the end, owner Lawrence Duran received an unheard-of 50 years, a sign that judges were finally acknowledging the magnitude of these swindles.

"It's like Whac-A-Mole," says Walther. "You knock one down, but now there's a bigger one somewhere else, and it's different. But once you figure it out, it rains on the back end with bad guys and money."

HEAT Agent Reginald France, a first-generation Haitian-American built like a linebacker, was out at 3 a.m. recently raiding a medical office. His motivation comes from the guile of these crimes.

"You have some of the smartest people in law enforcement working here," he says. "In a lot of ways, that drives us, because we want you to understand you can't pull the wool over our eyes."

Elderly Medicare recipients are crucial to the schemes. Instead of stealing patients' Medicare numbers, which are needed to submit invoices to Medicare, frauds pay the elderly in kickbacks. Recruiters typically pay beneficiaries a combination of cigarettes, booze, pills, and money. Cash payments can reach $2,000 quarterly. All recipients have to do is sign sheets confirming that care was received.

For the patient, it's a low-risk play. Nobody wants to put an 80-year-old meemaw in front of a jury. Prosecutors wouldn't recoup much even if they did. And since by law Medicare can't be revoked, there's little downside to bartering your number away for a carton of Kools.

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8 comments
dr.jaya
dr.jaya

This well written article should have beeen published in JAMA and New Engand Journal of Medicine ..

dr. jaya

smdrpepper
smdrpepper

Well considering that Rick Scott made millions off this should be telling.

Milord
Milord

Does it surprise anyone that a state that elected a man who made his millions by defrauding Medicare has an increasing problem with medicare fraud? It is high time the people of Florida extruded their crania from their recta and got rid of Gov. Voldemort! Over and over again the voters make the illogical, thoughtless and intelligence-denying choices. 

WAKE UP!

riverrat69
riverrat69 topcommenter

Medicare fraud might be sweet in south FloriDUH, but it buys you the governors seat in Tallahassee.

jefles
jefles

Chris mentions the congressional hearings where Congressman Burgess talks about his credit card and Chick-Fil-A.  At 1:01:28 of the same hearings, Congressman Shimkus holds up a card, that runs through the credit card networks, that would prevent much of that fraud.  I am the guy who invented it, and John Shimkus is holding up a card I gave him to demonstrate that not only is this possible, it works today.  We have proven it. 

frankd4
frankd4 topcommenter

"That's the bread and butter of the fraudster — the fact he can pay somebody to participate in the scheme," says Dennis. "If you have a willing participant, you then eliminate the ability to tie the fraud to you. That person is going to lie for you because they conspired with you."

in the olde dayz a gangster took the newbie with him and at the right time handed the newbie the GUN to do the hit........................voila the newbie was now a co-conspirator

so today the co-conspirator simply has to take money to collude, and collusion is the one thing an auditor cannot design an accounting system to prevent

if these clowns weren't so greedy these overbilling frauds could go on endlessly

frankd4
frankd4 topcommenter

don't just take ONE geographic area since any medical facility anywhere can simply CODE reimburseable medicare and medicaid medical proceedures to maximize revenue generated

the typical geographic area only need those who qualify for such coverage and who can produce a valid social security number = period

i can predict that every second hobo at a random bus station would be a potential profit center - i withnessed one old dude at BCT central terminal went from a walker ($300) every three weeks to a fully equiped wheelchair ($16,875) which he even had pin-striped; otherwise this miscreant didn't have two nickles to rub together

i saw it start myself a dozen or so years ago at assisted-living facilities whereas the home would profit from commissionable sales of goods and services to the qualifying residents who knew nothing of how things were being paid

finally MAIN street has a scam equal to WALL street, in scope and magnitude, which will eclipse even the mortgage meltdown, and certainly reach beyond our governors office, when fully exposed, as to who all the players really are

miami321973
miami321973

Hialeah is third world territory and not part of the United States.

 
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