The Chicago U.S. Attorney’s Office is creating a new unit to prosecute healthcare fraud. Assistant U.S. Attorney Heather McShain will lead the team of five prosecutors. The team brings local focus on combatting fraud in Medicare, which has been a national priority for the U.S. Department of Justice (DOJ) for nearly a decade.

Read the DOJ Press Release here.

Is this a sign of things to come?

Compliance remains an integral part of maintaining ethical control, and each department faces many new challenges in the digital age. Fraud in healthcare is no exemption and schemers are getting more elaborate and ambitious. Enforcement is up, and recent national fraud takedowns like the DOJ announced recently with its Strike Force’s largest-ever enforcement action illustrates the point. In this landmark case, the DOJ charged 412 people, including 115 medical professionals, with submitting $1.3 billion in fraudulent healthcare billings.*

*NOTE:  Fifteen individuals were from the Northern District of Illinois

In a statement, U.S. Attorney General Jeff Sessions said the doctors, nurses, and pharmacists had “chosen to violate their oaths and put greed ahead of their patients.”  

The fraud enforcement efforts have affected hospitals,long-term care, hospice, ambulance companies, and even EHR billing companies. Prosecution does not stop with the provider who caused it and can lead all the way to the CEO and executive suite.

In fact, recently a former General Counsel for WellCare, Thaddeus Bereday of Tampa, Florida, learned the hard way. He pled guilty to one count of making a false statement to the Florida Medicaid program. As a result, he faces a maximum of five (5) years in federal prison for his role as an executive in the fraud scheme. Four other WellCare executives were also found guilty of various federal criminal violations.

Former DOJ Attorney Sally Yates issued a memo last year setting certain guidelines for U.S. Attorneys to investigate and prosecute those individuals personally, not just the company itself, for their role in healthcare fraud.

“Every year, health care fraud causes millions of dollars in losses to Medicare and private insurers,” said Acting U.S. Attorney Levin. “Health care fraud also often exploits patients through unnecessary or unsafe medical procedures. Health care providers who cheat the system must be held accountable. Our office has successfully prosecuted numerous health care fraud cases in recent years. The new Health Care Fraud Unit will build on that success and bring even greater focus, efficiency and impact to our efforts in this important area.”

Healthcare Fraud Investigations Present Unique Challenges

There are many nuances in investigating and prosecuting a healthcare organization. Some of the most basic crimes cross into overall bribery/undue influence Stark Law violations, overpayments/false billings, and even care that is considered medically unnecessary or worthless. Cyber criminals are latching onto healthcare to get personal health and identifiable information for purposes of identity theft.

So federal prosecutors, like the newly created Chicago healthcare fraud team, have determined that special skills, training, and a focus on healthcare as its own unique industry makes the most sense. The ROI is there to prove it.

For every $1 spent by DOJ in 2016, they returned $8 to the U.S.

Who wouldn’t want that kind of a return on their investment? We may not like the extra scrutiny, but It is easy to understand why resources are continuing to be added to the fight against fraud, waste, and abuse in the healthcare industry.  

What trends are you seeing in healthcare compliance? We’d love to hear from you – leave a comment below!


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Written by Michael Rosen, ESQ

ProviderTrust Co-Founder, mrosen@providertrust.com

Michael brings over 20 years of experience founding and leading risk mitigation businesses, receiving numerous accolades such as: Inc Magazine’s Inc 500 Award and Nashville Chamber of Commerce Small Business of the Year.

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