Medicare fraud scheme "puts the traditional Mafia to shame"

A group of Armenian gangsters tried to cheat Medicare out of $163 million.

http://news.yahoo.com/s/ap/20101013/ap_on_bi_ge/us_medicare_fraud_arrests

A vast network of Armenian gangsters and their associates used phantom health care clinics and other means to try to cheat Medicare out of $163 million, the largest fraud by one criminal enterprise in the program's history, U.S. authorities said Wednesday.

Federal prosecutors in New York and elsewhere charged 73 people. Most of the defendants were captured during raids Wednesday morning in New York City and Los Angeles, but there also were arrests in New Mexico, Georgia and Ohio.

The scheme's scope and sophistication "puts the traditional Mafia to shame," U.S. Attorney Preet Bharara said at a Manhattan news conference. "They ran a veritable fraud franchise."

The defendants in the New York case also had stolen the identities of doctors and set up 118 phantom clinics in 25 states, authorities said. The names were used to submit fake bills for care that was never given, they said.

Some of the phony paperwork was a giveaway: It showed eye doctors doing bladder tests; ear, nose and throat specialists performing pregnancy ultrasounds; obstetricians testing for skin allergies; and dermatologists billing for heart exams.

In the New York portion of the case, more $100 million in fraudulent bills were submitted and Medicare paid out at least $35 million, sometimes by wiring it to the clinics' banks accounts, investigators said.

This is really nothing new either. 60 Minutes did a good report on it about fraud going on in Miami. As I recall, the big problem is that Medicare must pay claims within 30 days, and they are vastly understaffed to investigate false claims in that time frame. By the time they figure out something is wrong, the fake clinics that file the false claims have already shut down and moved to a new address with a new name.

I know private insurance certainly gets false claims, but I've never heard of them being duped for huge amounts by large groups like what's happening with Medicare.

Is this an example of how the government can't be trusted to keep medical costs under control?

pineinthegrass wrote: Is this an example of how the government can't be trusted to keep medical costs under control?

No, this is an example of how, because of politics, good programs are never fully funded. If the medicare program had the personnel that Insurance companies had they too could keep a lid on the fraud. And some of that fraud has come from the Insurance companies with their medicare Advantage plans.

archer wrote: No, this is an example of how, because of politics, good programs are never fully funded. If the medicare program had the personnel that Insurance companies had they too could keep a lid on the fraud. And some of that fraud has come from the Insurance companies with their medicare Advantage plans.

Guess what. Government is controlled by politics. Always has, and always will be unless we get a dictatorship. So politics is a built-in issue with government. And if you blame it on politics, you might as well blame it on government, IMO.

And I'm thinking the 30 day issue for payment by Medicare has a lot to do with the problem. That, plus Medicare will pay just about anybody that looks legit even though they've never dealt with them before, while private insurors have their own network of providers that they've developed and can count on. Why doesn't government try that? If they want, they can still have a larger network, but don't use the 30 day rule for new providers until they've proven to be reliable.

government is, of course controlled by politics....but it is also the only entitiy capable of providing a plan such as medicare or SS......same with our military......no other way to provide for the defense of our nation without all the branches of the military.....but it too is subject to fraud......the answer is not to eliminate federal programs (can you imagine the US without the military?) but to better manage them and con trol costs. So far both the Dems and the Reps have been inadequate in that goal, I seriously doubt that the new crop of tea partiers will have any more luck with it. the health care bill does head in the right direction on reining in medicare fraud, but it will need a support structure to do it. Interesting that the "savers" are never willing to spend 10 million to save 100 million.

Constantly referring to the Tea Party aren't you Archer? You admit the neither the Dems or Republicans have accomplished anything, yet you won't even consider the Tea Party. Amazing the answers that you give. Sounds like you have no faith in anybody but aren't willing to give anybody a chance. Sure sounds hopeless doesn't it?

Nmysys wrote: Constantly referring to the Tea Party aren't you Archer? You admit the neither the Dems or Republicans have accomplished anything, yet you won't even consider the Tea Party. Amazing the answers that you give. Sounds like you have no faith in anybody but aren't willing to give anybody a chance. Sure sounds hopeless doesn't it?

nope...never hopeless, just difficult. and really....it's rather hard to ignore the tea party, they have been ramming themselves down the collective American throats, rather annoyingly. If I thought for one minute they were any better for America than the run of the mill right wing extremists we already have i might give them a break, but to me they are the worst of what the Republican party has to offer.

Ramming down the throats of America!!! Sounds like your Democratic Party and the Healthcare bill to me. "We have to pass it to be able to read it", is what , I believe the Witch Pelosi said.

Sounds like everything that your Democratic President has done for over 1 1/2 years.

rather annoyingly

at that, look at the uproar nationwide.

Are you real? Or are you just repeating talking points every day?

Your responses are absolutely amazing, twisting the words to fit the Conservatives or the Tea Party Candidates to fit your argument.