Busted: The top fraud schemes of Q4 2022

As 2022 came to a close, bad actors in the healthcare system rang in the holiday season with fraudulent billing, Medicare fraud, kickbacks, falsified claims, and more, in some cases potentially harming patients directly. With help from the National Health Care Anti-Fraud Association (NHCAA), we’ve gathered some of the most prominent cases of fraud, waste, and abuse (FWA) from October through December 2022.

Nursing home neglect and fraud: $86 million

Nursing home owners and operators were accused of defrauding Medicare and Medicaid while committing patient neglect, causing deadly complications. A lawsuit alleges that the owners and operators stole 20% of Medicare and Medicaid payments intended for patient care. Officials believe that as a result, the nursing home was understaffed and provided low quality of care.

Kickbacks and bribes: $37 million

The FBI charged nine employees of Florida physical therapy clinics with healthcare fraud and conspiracy to commit healthcare fraud for their alleged scheme paying kickbacks to beneficiaries of private health plans and employees of several large companies. The group supposedly asked plan members and employees of the companies to act as patients for their physical therapy clinics. The group is also accused of paying kickbacks and bribes to each other for patient referrals and schemes to avoid medical clinic licensing.

Unnecessary drug tests for at-risk youth: $16 million

A North Carolina woman was charged for defrauding Medicaid with more than $16 million in fraudulent claims. According to prosecutors, the woman also allegedly received more than $1.5 million in illegal kickbacks. They say she paid college students to recruit youths that might be Medicaid eligible for after-school and mentoring programs, then required the youths to take a drug tests through a lab from which she received kickbacks.

Email compromise and wire fraud: $11.1 million

Ten people across the east coast were charged with business email compromise, wire fraud, and money laundering. This group allegedly targeted Medicare, Medicaid, and private health insurance companies, defrauding these groups of more than $4.7 million, with $6.4 million in losses for other federal agencies, companies, and individuals. Supposedly, the group diverted money from victims’ bank accounts into their own by using fake email accounts, initiating bank account takeovers and using other methods to deceive their targets into believing they were paying legitimate charges.

Prescription fraud scheme: $10.5 million 

A pharmacy employee and the owner/employee of another pharmacy, were charged with committing prescription fraud schemes that targeted Medicare and Medicaid, resulting in $10.5 million in charges to the two government programs. Officials allege the two paid illegal kickbacks and bribes  for filling medically unnecessary prescriptions signed by providers to whom the accused referred individuals, giving the individuals gift cards, store credit, and/or cash for each prescription brought to the pharmacy. In addition, the two accused would allegedly pay cash for the individuals’ monthly insurance allowance for over-the-counter products.

Cancer genetic testing scheme: $9.6 million

A Chicago physician was charged with a cancer genetic testing scheme, allegedly defrauding Medicare and Medicaid of more than $9.6 million. The physician allegedly requested cancer genetic testing for patients, even if it was not necessary or he hadn’t actually met with the patient, in order to receive kickbacks from marketers. He’s also accused of not following up with patients to inform them of their testing results.

COVID-19 testing scheme: $7 million

Two Texans were charged with conspiracy to commit healthcare fraud, aggravated identity theft, and money laundering for allegedly submitting fraudulent COVID-19 testing claims. The two allegedly owned several fake diagnostic laboratories and used their positions to obtain protected patient and insurer information to submit test requests when no tests were ever performed.

Fraudulent genetic testing and bribes: $2.9 million

Two people were charged with conspiracy to defraud Medicare of $2.9 million and 22 counts of wire fraud. The two accused owned and operated a Kansas community care center while a Florida company  allegedly providing genetic tests paid them bribes for Medicare patient referrals.

Impossible psychiatric services: $1.36 million

A Pennsylvania psychiatrist was charged with healthcare fraud for allegedly defrauding Medicare of $1.36 million. According to the case, the psychiatrist billed for services he and his staff did not actually provide, billed for deceased patients, and claimed to have provided more than 24 hours' worth of services in one day.

Cotiviti leverages more than 20 years of experience to provide program integrity expertise and help you better manage your anti-fraud programs and investigative costs. Our industry-leading software and services deliver an end-to-end fraud, waste, and abuse solution, including improved program compliance and documented return on investment. Read our fact sheet to learn more about how our Special Investigative Unit services support a variety of claim investigations, including facility, professional, and pharmacy.

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Erin Rutzler
As vice president of fraud, waste, and abuse (FWA), Erin is responsible for the oversight and strategic direction of Cotiviti’s FWA solution suite. In her role, Erin has been integral in the development of Cotiviti’s FWA solutions over the past ten years. Serving as the company’s primary subject matter expert in investigations and FWA for compliance, client training, sales, and marketing activities, she regularly represents the company at industry conferences such as the National Health Care Anti-Fraud Association’s (NHCAA) Annual Training Conference (ATC).

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