by Ashley D. Adams

Most people think of white collar crimes as those involving large business fraud schemes such as those perpetrated by Bernie Madoff, and the Enron, and WorldCom scandals. Physicians and hospital administrators are not generally regarded by the public as potential white collar criminals. However, health care fraud is a very real form of white collar crime, and has quickly become a top priority for the United States Justice Department under the Obama Administration, and law enforcement nationwide. Health care expenditures for 2009 alone were estimated to be over $2.4 trillion. Billions of dollars are lost every year to Medicare and Medicaid fraud.

Health care fraud can take various forms, and can involve very complex schemes. The most common are:

  1. billing for services not performed
  2. billing for services not needed
  3. upcoding (billing for a more expensive procedures)
  4. billing for medical equipment that was never provided
  5. accepting kickbacks in exchange for referrals

The Internet Pharmacy Initiative, as another example, targets websites that provide drugs and controlled substances to patients without a prescription. Most of these websites allow a patient to obtain drugs such as Oxycontin or Xanax with little, if any, interaction with a physician, which is illegal in most states. The FBI has developed several other initiatives, targeting outpatient surgery centers and durable medical equipment providers.

In February of 2011, the Justice Department announced that its newly created “Medicare Fraud Strike Force” charged over 100 defendants in nine different cities, including doctors, nurses, and health care companies and owners, for their alleged participation in Medicare fraud schemes exceeding $225 million in false billings. Over 700 law enforcement agencies nationwide participated in the investigation. It is very likely that we will see an increase in Medicare fraud investigations. As always, the question is whether the United States Attorney’s Office will devote the necessary resources to prosecute these sometimes very complex cases.

If you have further questions about this issue, please contact Ashley D. Adams, PLC 480.219.1366 or,  Ashley is a criminal defense attorney in Scottsdale and a former federal prosecutor.