DOJ Medicare Strike Force Obtains Major Victory In $1 Billion Indictment

9 Aug 2016
Mark Josephs

A Miami grand jury late last month returned an indictment in a Medicare fraud investigation that involved approximately $1 billion in fraud, the largest such fraud case every brought by the United States.  The Miami Medicare “Strike Force” was responsible for bringing this case, which involves elaborate kickback schemes, falsification of documents, submission of false claims to Medicare and Medicaid, and, tragically in some cases, the abuse of elderly Medicare beneficiaries who were cycled through nursing homes and assisted living facilities whether they needed to be there or not.

The Department of Justice created Medicare Strike Forces in two major cities approximately 10 years ago, and the Affordable Care Act provided $350 million to bring Strike Forces to seven more cities.  These Strike Forces involve placing criminal fraud attorneys from the main Department of Justice in Washington within U.S. Attorney’s offices to assist Assistant U.S. Attorneys in bringing health care fraud cases or to bring cases themselves.

The indictment in this case (No. 16-20549 (S.D. Fla.)) makes for interesting reading.  It describes elaborate kickback, bribery, and other fraudulent schemes involving a network of health care entities owned by the primary defendant, Philip Esformes.  Mr. Esformes was reportedly worth over $75 million, and the forfeiture allegations tie him to several large homes and expensive personal property.  As is typical in these large fraud cases, some details are salacious – in this one, Mr. Esformes allegedly used fraud proceeds to fly escorts to meet him at a Ritz-Carlton in Orlando.

This indictment shows that DOJ’s Medicare fraud efforts continue unabated, using the increased funding from the Affordable Care Act to continue the work that has led to the convictions of approximately 2000 defendants and the return of billions of dollars to the government.  There currently is no Strike Force in Boston, as the historical strength of the health care units in the United States Attorney’s Offie here perhaps have caused officials to feel that a Strike Force commitment is unnecessary.  But that of course does not mean that placement of a Strike Force here could occur in the future, particularly given the large health care industry presence in Boston.  Nevertheless, prosecutors here are surely on the look-out for opportunities to bring important cases in this area.

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