In A Multibillion-dollar Healthcare Fraud Scheme, “Unnecessary” Skin Grafts Were Administered To Patients: DOJ

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In A Multibillion-dollar Healthcare Fraud Scheme, "Unnecessary" Skin Grafts Were Administered To Patients: DOJ

The Department of Justice (DOJ) announced sweeping charges against more than 300 defendants on Monday, alleging that they misled patients into paying for and sometimes receiving unnecessary medical care.

In turn, DOJ Criminal Division chief Matthew Galeotti stated that the defendants attempted to defraud Medicare and other taxpayer-funded and private health insurance programs out of approximately $14.6 billion.

The announcement marked the “largest coordinated healthcare fraud takedown in the history of the Department of Justice,” Galeotti said during a press conference.

According to a press release, 29 defendants were charged with alleged involvement with transnational criminal organisations and submitting more than $12 billion in fraudulent claims to America’s health insurance programs.

Another 74 defendants, including 44 licensed medical professionals, were charged in 58 cases for allegedly illegally distributing 15 million prescription opioid pills and other controlled substances.

For example, five defendants at a Texas pharmacy are accused of illegally distributing over 3 million opioid pills, including oxycodone, hydrocodone, and carisoprodol, which were then trafficked by drug dealers on the streets.

According to the DOJ, 49 defendants were charged with submitting more than $1.17 billion in alleged fraudulent claims to Medicare, while an additional 170 defendants were charged with various other fraudulent schemes totalling $1.84 billion in claims to Medicare, Medicaid, and private insurance companies for diagnostic testing, medical visits, and unnecessary treatments, sometimes in exchange for kickbacks and bribes.

“This record-setting Health Care Fraud Takedown delivers justice to criminal actors who prey upon our most vulnerable citizens and steal from hard-working American taxpayers,” Pamela Bondi, the state’s attorney general, said. “Make no mistake – this administration will not tolerate criminals who line their pockets with taxpayer dollars while endangering the health and safety of our communities.”

One set of charges included an indictment against three defendants in Arizona who allegedly conspired to purchase and give elderly Medicare recipients skin grafts known as “amniotic wound allografts.” The defendants allegedly made millions of dollars from the practice.

One of the defendants, a nurse practitioner, performed the grafts on patients despite the fact that they were “medically unreasonable and unnecessary,” according to the indictment. The nurse allegedly used them on terminally ill hospice patients, some of whom were only days away from death.

While that particular medical practice is usually non-invasive, Galeotti stated that it was part of a $1 billion healthcare fraud scheme that deprives patients of “dignity and peace” in their final days.

“That conduct is exactly as callous and disturbing as it sounds,” Galeotti told the crowd. “Patients and their families trusted these providers with their lives. Instead of receiving care, they were the victims of elaborate criminal schemes.”

In response to a Fox News Digital question, a DOJ official stated that skin grafts were a “emerging area” of healthcare fraud, “especially given the significant amount of money that they can bill for, sometimes in excess of $1,000 per square centimetre.”

The healthcare fraud cases, which were all made public online, spanned the country and the globe. The defendants were medical supply company owners and medical professionals, including 25 doctors.

At the press conference, an FBI official announced that one scheme, known as “Operation Gold Rush,” resulted in the charges of at least 20 members of a transnational criminal organisation, including defendants from Russia, as part of a $10 billion Medicare and money laundering operation centred on catheters.

According to authorities, the scheme’s perpetrators used foreign straw owners to buy dozens of medical supply companies in secret before creating and filing false $10.6 billion in Medicare claims using stolen identities and confidential health information.

According to the DOJ, 19 defendants were arrested for their involvement in the scheme, with 12 already arrested. Four of the 12 were apprehended in Estonia thanks to international cooperation with Estonian law enforcement. Seven of the defendants were apprehended at US airports and the US border.

The DOJ Criminal Division’s healthcare fraud unit spearheaded the investigation. Galeotti also announced on Monday that the DOJ would form a “fusion centre” with other agencies to consolidate healthcare data as part of its fraud investigations.

Galeotti and Dr. Mehmet Oz, administrator of the Centres for Medicare and Medicaid Services, also used the press conference to request additional tips.

“We need your help, the American people,” Oz proclaimed. “Why? Over half of the whistleblower tips we receive are for healthcare fraud, and healthcare fraud accounts for more than half of all fraud committed against our government.”

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