Health Care Fraud Crackdown on the West Coast
Scammers on the West Coast are being warned as the Justice Department initiates a major crackdown on health care fraud, specifically targeting a hospice program in Los Angeles.
During a press conference on Thursday, officials from the U.S. Attorney’s Office for the Northern District of California in San Francisco revealed that the Justice Department’s National Fraud Enforcement Division has set up a “strike force” aimed at tackling widespread health care fraud in the region.
Assistant Attorney General Colin MacDonald highlighted the seriousness of the situation, stating, “If you steal from American taxpayers, the Department of Justice and our law enforcement partners will do whatever it takes to give you free housing in a federal prison.”
This newly formed team will unite federal prosecutors from California, Arizona, and Nevada to effectively combat health care fraud, leveraging data to uncover extensive medical billing schemes that have been identified in Los Angeles and other West Coast cities.
Prosecutors pointed to an alarming case involving an Arizona couple charged with submitting $1.2 billion in fraudulent claims to Medicare and other insurers for “medically unnecessary” wound transplants, for which they also received kickbacks.
This couple exploited vulnerable elderly individuals, securing costly transplant treatments and related insurance claims, ultimately accumulating $97 million across 28 bank accounts and purchasing four high-end cars, including a Ferrari 488 Spider convertible and several Mercedes-Benz models, along with $348,000 in gold and silver.
Misakian, another key official, noted additional high-profile prosecutions led by U.S. officials in the Northern District, mentioning cases like Theranos founder Elizabeth Holmes and Mark Schena, who fraudulently sold fake blood tests during the pandemic while portraying himself as a Nobel Prize contender.
Assistant Attorney General Colin McDonald further added that this strike force might also investigate hospice fraud along with various other activities. “We’re going to focus on those kinds of programs here,” he said, mentioning the ongoing active investigations. “This new strike force will accelerate those efforts.”
The newspaper had previously reported on significant hospice fraud in Los Angeles. For the first time, a watchdog group raised concerns about such fraud, citing a troubling increase in the number of new hospice centers in recent years.
The Post discovered a network of questionable hospice facilities, with multiple entities listed at the same addresses. Some of these locations included empty storefronts, auto parts shops, and other offices that had been abandoned for years.
In response, Vice President J.D. Vance has suspended the licenses of 447 facilities and 23 home health agencies categorized as suspicious as part of the National Fraud Task Force.
