The Department of Justice has filed criminal charges against 138 defendants — including 42 doctors, nurses, and other licensed medical professionals — for their alleged participation in numerous health care fraud schemes resulting in nearly $1.4 billion in alleged losses, according to the DOJ Office of Public Affairs.
Investigators found that a majority of the fraud cases, tallied at $1.1 billion, were committed using telemedicine, the practice of using technology to deliver care at a distance, which has sky-rocketed in popularity and possibility during the pandemic.
Since the pandemic began, telehealth services and popularity have increased 38 times from the pre-pandemic baseline, blossoming into a quarter-trillion dollar market.
To that end, much of the remaining losses are related to fraud cases for COVID-19 care ($29 million), substance abuse treatment ($133 million), and other health care schemes related to opioid distribution ($160 million), according to the DOJ report.
The investigative and enforcement actions were led and coordinated by the Health Care Fraud Unit of the Criminal Division’s Fraud Section, in conjunction with its Health Care Fraud and Appalachian Regional Prescription Opioid (ARPO) Strike Force program and its core partners, the U.S. Attorneys’ Offices, Department of Health and Human Services Office of Inspector General (HHS-OIG), FBI, and Drug Enforcement Administration (DEA).
“Holding to account those responsible for health care fraud and diversion of prescription drugs is a priority for DEA,” said Anne Milgram, administrator of the Drug Enforcement Administration, in a statement Friday.
“These fraudulent activities prey on our most vulnerable – those in pain, the substance-addicted, and even the homeless – those who are most susceptible to promises of relief, recovery, or a new start.”
Telehealth Fraud Cases
According to court documents, some defendants are telemedicine executives, who allegedly paid doctors and nurse practitioners to order “unnecessary durable medical equipment, genetic and other diagnostic testing, and pain medications, either without any patient interaction or with only a brief telephonic conversation with patients they had never met or seen.”
In some instances, medical professionals billed medicare for “sham telehealth consultations” — many of which never took place.
Following the orders from the healthcare practitioners, the equipment companies, genetic testing laboratories, and pharmacies purchased the orders in exchange for illegal kickbacks and bribes submitted for over $1.1 billion.
Many of the claims involve Medicare and other government insurers — preying on vulnerable individuals, the DOJ reports.
What’s worse, the investigators outline, is that many of the proceeds of the scheme pocketed by telemedicine executives, doctors, and nurses were spent on “luxury items” including vehicles, yachts, and real estate.
COVID-19 ‘Relaxed’ Telehealth Rules
In Florida, a laboratory owner saw the pandemic as an opportunity to bill the government and Medicare for unnecessary genetic testing, knowing that under the unprecedented times, Medicare expanded telehealth services during the Public Health Emergency which allowed for many medical orders to go unchecked.
In other words, because of the pandemic, temporary amendments to telehealth restrictions allowed “telehealth providers access to medicare beneficiaries for whom they could bill consultants,” according to the National Law Review (NLR).
This lab owner, in particular, worked with a telemedicine company to funnel all genetic testing for cancer and cardiovascular diseases to their facility, then obscuring payments for testing as an “IT and consultation services” contract, the NLR reports.
Other cases noted by the DOJ in their investigative report resulted in medical professionals misusing patient information to submit Medicare claims for unrelated and unnecessary testing orders.
“Health care fraud targets the vulnerable in our communities, our health care system, and our basic expectation of competent, available care,” said Assistant Director Calvin Shivers of the FBI’s Criminal Investigative Division. “Despite a continued pandemic, the FBI and our law enforcement partners remain dedicated to safeguarding American taxpayers and businesses from the steep cost of health care fraud.”
Opioid Treatment via Telehealth
While the DOJ investigative report is concerning, many advocates are quick to point out the benefits and increased access to telehealth services, and what impact that can have in the future for areas like prison healthcare, and opioid addiction treatment.
To that end, many agree that kinks need to be ironed out in the process if we are to avoid fraud schemes on such a grand level for the future, McKinsey & Company reports.
In their research, McKinsey & Company detail that roughly 30 percent of telehealth claims across specialties were for substance use disorder treatment. While much of those are legitimate claims that help hundreds of thousands of people, some are using their treatment power for schemes.
The DOJ has recognized this, noting that substance abuse treatment, and other health care schemes related to opioid distribution resulted in nearly $300 million in losses.
In particular, the DOJ identified 19 defendants, who have prescribed over 12 million doses of opioids and other prescription narcotics, while submitting over $14 million in false billings.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division is hopeful that by bringing many to justice, it will pave the way for a better system.
“The charges announced today send a clear deterrent message and should leave no doubt about the department’s ongoing commitment to ensuring the safety of patients and the integrity of health care benefit programs, even amid a continued pandemic,” Polite concluded.
The full Department of Justice report can be accessed here.
Andrea Cipriano is a TCR staff writer.