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Archive for Thursday, October 14, 2010

Largest Medicare scam ever uncovered

October 14, 2010

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— 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.”

Unlike other cases involving crooked medical clinics bribing people to sign up for unneeded treatments, the operation was “completely notional,” Janice Fedarcyk, head of the FBI’s New York office, said in a statement. “The whole doctor-patient interaction was a mirage.”

The operation was under the protection of an Armenian crime boss, known in the former Soviet Union as a “vor,” prosecutors said. The reputed boss, Armen Kazarian, was in custody in Los Angeles.

Bharara said it was the first time a vor — “the rough equivalent of a traditional godfather” — had been charged in a U.S. racketeering case.

Kazarian, 46, of Glendale, Calif., and two alleged ringleaders were named in an indictment charging racketeering conspiracy, bank fraud, money laundering and identity theft.

Comments

Richard Heckler 4 years ago

The Bad Doctor Bill Frist’s long record of corporate vices A A A Comments (1) By Doug Ireland Thursday, Jan 9 2003

While TV gushed last week over the Republicans’ new Senate majority leader, Bill Frist, intervening in a traffic accident, portraying the former heart surgeon as a “Good Samaritan,” in truth the GOP has simply replaced a racist with a corporate crook.

Frist was born rich, and got richer -- thanks to massive criminal fraud by the family business. The basis of the Frist family fortune is HCA Inc. (Hospital Corporation of America), the largest for-profit hospital chain in the country, which was founded by Frist‘s father and brother. And, just as Karl Rove was engineering the scuttling of Trent Lott and the elevation of Frist, the Bush Justice Department suddenly ended a near-decadelong federal investigation into how HCA for years had defrauded Medicaid, Medicare and Tricare (the federal program that covers the military and their families), giving the greedy health-care behemoth’s executives a sweetheart settlement that kept them out of the can.

The government‘s case was that HCA kept two sets of books and fraudulently overbilled the government. The deal meant that HCA agreed to pay the government $631 million for its lucrative scams -- which, on top of previous fines, brought the total government penalties against the health-care conglomerate to a whopping $1.7 billion, the largest fraud settlement in history, breaking the old record set by Drexel Burnham.

The deal also meant that HCA can continue to participate in Medicare. And, as part of the Bushies’ deal shutting down what Deputy Assistant FBI Director Thomas Kubic called “one of the FBI‘s highest-priority white-collar crime investigations,” no criminal charges were brought against the top HCA execs who presided over the illegal bilking of federal programs designed to aid the poor -- and that includes Senator Frist’s brother, Thomas, HCA‘s former CEO (and current director), who’s been described by Forbes magazine as “one of the richest men in America,” with a personal fortune estimated at close to $2 billion.

What did HCA do? It inflated its expenses and billed the government for the overrun; it billed the government for services ineligible for reimbursement (like advertising and marketing costs). HCA violated both law and medical ethics when, as Forbes put it, “the company increased Medicare billings by exaggerating the seriousness of the illnesses they were treating. It also granted doctors partnerships in a company hospitals as a kickback for the doctors‘ referring patients to HCA. In addition, it gave doctors ’loans‘ that were never expected to be paid back, free rent, free office furniture -- and free drugs from hospital pharmacies.”

This is the ethical climate that reigned in the Frist family’s money machine

con't http://www.laweekly.com/2003-01-16/news/the-bad-doctor/

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Richard Heckler 4 years ago

How about fraud on the backs of medical insurance consumers?

Did anyone receive refunds?

Thursday, June 25, 2009

Health insurers have forced consumers to pay billions of dollars in medical bills that the insurers themselves should have paid, according to a report released yesterday by the staff of the Senate Commerce Committee.

The report was part of a multi-pronged assault on the credibility of private insurers by Commerce Committee Chairman John D. Rockefeller IV (D-W.Va.). It came at a time when Rockefeller, President Obama and others are seeking to offer a public alternative to private health plans as part of broad health-care reform legislation. Health insurers are doing everything they can to block the public option.

At a committee hearing yesterday, three health-care specialists testified that insurers go to great lengths to avoid responsibility for sick people, use deliberately incomprehensible documents to mislead consumers about their benefits, and sell "junk" policies that do not cover needed care. Rockefeller said he was exploring "why consumers get such a raw deal from their insurance companies."

The star witness at the hearing was a former public relations executive for major health insurers whose testimony boiled down to this: Don't trust the insurers.

"The industry and its backers are using fear tactics, as they did in 1994, to tar a transparent and accountable -- publicly accountable -- health-care option," said Wendell Potter, who until early last year was vice president for corporate communications at the big insurer Cigna.

Potter said he worries "that the industry's charm offensive, which is the most visible part of duplicitous and well-financed PR and lobbying campaigns, may well shape reform in a way that benefits Wall Street far more than average Americans."

Insurers make paperwork confusing because "they realize that people will just simply give up and not pursue it" if they think they have been shortchanged, Potter said.

More on this story: http://www.washingtonpost.com/wp-dyn/content/article/2009/06/24/AR2009062401636.html

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Richard Heckler 4 years ago

Could reckless spending of health care dollars be known as fraud on the backs of heath insurance consumers?

What increases the cost of medical insurance? High dollar reckless spending on: corp jets • its mammoth bureaucracy • obscene profits • high corporate salaries • advertising over charges • Shareholders CERTAINLY increases the cost of insurance • Special interest campaign dollars Golden parachutes Politicians as shareholders: http://www.washingtonpost.com/wp-dyn/content/article/2009/06/12/AR2009061204075.html

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Richard Heckler 4 years ago

How about the $1.4 million a day the medical insurance industry was blowing to keep single payer insurance off the table?

How about the $73 million retirement bonus for the outgoing CIGNA CEO?

Are not all above examples of fraudulent use health care dollars? Perhaps it's time medical insurance consumers hauled the industry into court?

How do sick and injured insurance consumers afford golden parachutes? = fraud!

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beatrice 4 years ago

Excellent! Glad they could stop these criminals from continuing to defraud us.

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tolawdjk 4 years ago

Very seldom do I agree with you but I give credit where credit is due.

+1

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