The Department of Justice announced today criminal charges against 138 defendants, including 42 doctors, nurses, and other licensed medical professionals, in 31 federal districts across the United States for their alleged participation in various health care fraud schemes that resulted in approximately $1.4 billion in suspected losses.

The charges target approximately $1.1 billion in fraud committed using telemedicine, $29 million in COVID-19 health care fraud, $133 million connected to substance abuse treatment facilities, or “sober homes,” and $160 million connected to other health care fraud and illegal opioid distribution schemes across the country.

Telemedicine Fraud Cases

The largest amount of alleged fraud loss charged in connection with the cases announced today – over $1.1 billion in allegedly false and fraudulent claims submitted by more than 43 criminal defendants in 11 judicial districts – relates to schemes involving telemedicine. According to court documents, certain defendant telemedicine executives 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. Durable medical equipment companies, genetic testing laboratories, and pharmacies then purchased those orders in exchange for illegal kickbacks and bribes and submitted over $1.1 billion in false and fraudulent claims to Medicare and other government insurers. In some instances, medical professionals billed Medicare for sham telehealth consultations that did not occur as represented. The proceeds of the scheme were spent on luxury items, including vehicles, yachts, and real estate.

COVID-19 Fraud Cases

Nine defendants in the cases announced today are alleged to have engaged in various health care fraud schemes designed to exploit the COVID-19 pandemic, which resulted in the submission of over $29 million in false billings. In one type of scheme, defendants are alleged to have exploited policies that were put in place by the CMS to enable increased access to care during the COVID-19 pandemic, such as expanded telehealth regulations and rules. Defendants allegedly misused patient information to submit claims to Medicare for unrelated, medically unnecessary, and expensive laboratory tests, including cancer genetic testing.

The law enforcement action today also includes criminal charges against five defendants who allegedly engaged in the misuse of Provider Relief Fund monies. The Provider Relief Fund is part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a federal law enacted March 2020 designed to provide needed medical care to Americans suffering from COVID-19. The defendants allegedly used the moneys for their own personal expenses, including for gambling at a Las Vegas casino and paying a luxury car dealership. 

Sober Homes Cases

The sober homes cases are announced on the one-year anniversary of the first ever national sober homes initiative in 2020, which included charges against more than a dozen criminal defendants in connection with more than $845 million of allegedly false and fraudulent claims for tests and treatments for vulnerable patients seeking treatment for drug and/or alcohol addiction. The over $133 million in false and fraudulent claims that are additionally alleged in cases announced today reflect the continued effort by the National Rapid Response Strike Force and the Health Care Fraud Unit's Los Angeles Strike Force, with the participation of the U.S. Attorneys' Offices for the Central District of California and the Southern District of Florida, to prosecute those who participated in illegal kickback and bribery schemes involving the referral of patients to substance abuse treatment facilities; those patients could be subjected to medically unnecessary drug testing – often billing thousands of dollars for a single test – and therapy sessions that frequently were not provided, and which resulted in millions of dollars of false and fraudulent claims being submitted to private insurers.

Cases Involving the Illegal Prescription and/or Distribution of Opioids and Cases Involving Traditional Health Care Fraud Schemes

The cases announced today involving the illegal prescription and/or distribution of opioids involve 19 defendants, including several charges against medical professionals and others who prescribed over 12 million doses of opioids and other prescription narcotics, while submitting over $14 million in false billings. The cases that fall into more traditional categories of health care fraud include charges against over 60 defendants who allegedly participated in schemes to submit more than $145 million in false and fraudulent claims to Medicare, Medicaid, TRICARE, and private insurance companies for treatments that were medically unnecessary and often never provided.