Feds Indict Texans for Alleged Medicare Fraud

The Associated Press

United States Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price announced the “largest health care fraud takedown operation in American history” on Thursday in which hundreds of individuals nationwide were indicted for their alleged roles in bilking U.S. taxpayers out of $1.3 billion by filing false Medicare claims. One in four of these cases involved opioid-related crimes.

More than 3o Texans were among the 412 defendants charged in this federal crackdown on Medicare fraud and opioid painkiller abuse. Roughly 1,000 law enforcement agents worked on the multi-agency sting under the Medicare Fraud Strike Force to bring to justice cases from 41 federal districts in dozens of states that included 115 doctors, nurses and other licensed medical professionals accused of participating in fraudulent health care schemes. Other enforcement actions included investigations brought forth by 31 U.S. Attorneys offices.

In prepared remarks delivered at a press conference Thursday in Washington, D.C., Sessions said 120 of the defendants were indicted on opioid-related offenses.

“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” stated Sessions, noting that these individuals seem “oblivious” to the “disastrous consequences of their greed.”

He referred to a case at an “illegal” Houston clinic. “Just one doctor at this clinic allegedly gave out 12,000 opioid prescriptions for over two million illegal painkiller doses. These defendants have been charged and they will face justice,” he stated.

According to the Justice Department, two individuals in connection with the Houston clinic were each charged on one count of conspiracy to distribute and dispense controlled substances plus three counts of unlawful distribution of controlled substances. The feds alleged this purported pain management clinic was the highest prescribing hydrocodone facility in Houston where clinicians saw roughly 60-70 people daily and the doctor prescribed “medically unnecessary” hydrocodone in exchange for approximately $300 cash per visit.

The Houston Chronicle identified these individuals as Houston physician Gazelle Craig, who specialized in pain management at the Gulfton Community Health Center, and clinic owner Shane Faithful.

Around $108 million of the fraudulent billings came from Texas. In the state’s U.S. Attorney’s Office of Southern District, 26 people face charges of defrauding the government out of $66 million. Across the eastern, northern, and western district offices, nine defendants got charged for their roles in schemes that racked up more than $42 million in fraudulent billing and false claims for compounded medications.

In Arizona, Arkansas , California, Delaware, Illinois, Iowa, Louisiana, Massachusetts, Michigan, Minnesota, Mississippi, New York, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Vermont, Washington, and Wisconsin, 96 defendants were charged in criminal and civil actions with defrauding Medicaid out of more than $31 million, says the Justice Department.

In his comments, Sessions also referenced a Palm Beach, Florida, “fake rehab facility” for recovering drug addicts that allegedly recruited addicts with gift cards and visits to strip clubs as billing more than $58 million in faux treatments and tests. He cited six Michigan doctors, now defendants, who purportedly ran a ruse to prescribe patients unnecessary opioids “some of which ended up for sale on the street.” He said these individuals allegedly billed Medicare for $164 million in false claims.

“As a result of this operation, 295 health care providers are now in the process of being suspended or banned from participation in federal health programs,” said Sessions. “We are sending a clear message to criminals across the country; we will find you. We will bring you to justice, and you will pay a very high price for what you have done.”

This week, the Office of the Inspector General (OIG) released staggering statistics about opioid use in the Medicare Part D prescription drug benefit program. Last year, 14.4 million of the 43.6 million, or one in three, beneficiaries filled at least one prescription for opioids. Half a million of them received high doses for at least three months. Other patients got extreme opioid amounts, appeared to be “doctor shopping,” and had multiple subscribers and pharmacies.

They identified tramadol, also known as Vicodin or as the generic hydrocodone-acetaminophen, and oxycodone-acetaminophen, better recognized as Percocet, as the most commonly prescribed opioids. One in five Medicare beneficiaries who received high doses of opioids had at least one 30 m.g. prescription for oxycodone, the most commonly involved in law enforcement cases. These figures, the OIG notes, do not include cancer or hospice patients.

Prescription and illicit opioids are the main driver of U.S. drug overdose deaths, which have quadrupled since 1999.

“Last year, an estimated 59,000 Americans died from a drug overdose, many linked to the misuse of prescription drugs. This is quite simply, an epidemic,” said Chuck Rosenberg, acting head of the Drug Enforcement Administration (DEA) at the press conference.

In 2015, more than 33,000 opioid-related deaths were reported nationwide, including 1,186 in Texas.

In June, Attorney General Ken Paxton announced his office joined a bipartisan coalition of state attorneys general investigating whether drug manufacturers unlawfully marketed or sold opioids. Paxton defined the crisis as a “public safety and public health issue,” noting opioid-abuse, addiction, and overdose devastate families nationwide.

In May, the Substance Abuse and Mental Health Administration, an HHS interagency, granted the Texas HHS Commission $27.4 million in federal funds to combat opioid dependency and boost state efforts at prevention and treatment.

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