Government moves to staunch massive Medicare fraud

By Jane Sutton

MIAMI (Reuters) - Since 2006, U.S. taxpayers have paid nearly $155,000 to send home health nurses to inject twice-daily insulin shots for an elderly, diabetic Miami man.

But in fact, the man was not diabetic or homebound and the nurses never existed, according to a federal indictment. Now the owners of two Miami companies that purportedly cared for the man are charged with running a $22 million fraud scheme at the expense of Medicare, the federal health program for the elderly and disabled.

Medicare billing records showed the man, identified in court documents as M.G., had rarely ordered any insulin or syringes. When his care switched from one home care company to another, he had no injections for 30 days -- "miraculously cured of his alleged insulin-dependence for a month," U.S. prosecutors joked in court papers.

As the Obama administration pursues an overhaul of the U.S. health care system and proposes expanding government's role, it also has expanded efforts to root out the fraud that is bleeding tens of billions of dollars a year from Medicare.

The gigantic federal program provides health care for 45 million people who are over 65, blind or disabled and has a proposed budget of $453 billion next year.

In June, the Justice Department and Department of Health and Human Services created Medicare anti-fraud strike forces in Detroit and Houston. Like one set up in Los Angeles last year, they are modeled after one born in Miami, the nation's Medicare fraud capital.

CULTURE FOR MEDICARE FRAUD

In a state with a huge retiree population, Miami is especially rife with Medicare scams because it has pools of non-English-speaking elderly residents who often do not understand the billing practices, federal prosecutors said. It also is a diverse urban area where patients do not necessarily know their doctors and nurses or even their neighbors.

"Miami is a place where anyone from anyplace in the world can blend in," said Jeffrey Sloman, acting U.S. attorney for southern Florida.

Miami has seven teams of prosecutors, FBI agents and federal auditors looking very hard for Medicare scams. Since the precursor to that strike force was set up in 2005, more than 700 people have been charged with fraudulently billing Medicare more than $2 billion in the Miami area, and $350 million has been recouped, Sloman said.

As the new anti-fraud forces ramp up, "I think those other parts of the country are going to discover that they also have a significant Medicare fraud problem," he said.

Increasingly, federal agents and the companies that process Medicare claims are cross-referencing bills and using data mining to try to find suspicious patterns.

They focused on the diabetic injection scam after finding Medicare spending for home health care in the Miami area had jumped tenfold in a couple of years, though there had been no surge in the elderly population or prevalence of diabetes.

Another audit showed three south Florida counties accounted for 72 percent of Medicare charges nationwide for HIV/AIDS beneficiaries, although only 8 percent of such patients lived there. Most of the money went to intravenous drug therapy.

NON-EXISTENT CLINICS