Federal law enforcement agencies announced Thursday what they called “the largest opioid-related fraud takedown in history” with the arrest of 120 people across the country, including doctors allegedly running pill mills and the operators of fraudulent treatment centers.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” Attorney General Jeff Sessions said in announcing the arrests. “Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start.”
STAT and the Boston Globe reported earlier this month that patient brokers are fraudulently enrolling people seeking drug addiction treatment in premium private insurance plans in order to send them to faraway centers that pocket thousands of dollars in claims for each patient. To sign up these patients, the brokers often use phony addresses and enlist licensed insurance brokers to enroll them through the online insurance marketplace created by the Affordable Care Act.
The opioid addiction epidemic has attracted fraudsters who “look at this national scourge, and they see an opportunity to profit from their fellow citizen’s suffering and pain,” said Health and Human Services Secretary Tom Price.
The crackdown on opioid-related cases was reported as part of the Justice Department’s annual announcement of health care fraud enforcement efforts. In total, Sessions said 412 people, including 56 doctors, were charged with defrauding federal health programs of $1.3 billion. Sessions said federal investigators “believe there are a lot more cases that need to be brought” and that the medical community needs to continue efforts to reduce the amount of opioid prescribing in the country.
Several of the cases announced Thursday have been in the works for months or years.
They include that of a Delray Beach, Fla., drug treatment center that fraudulently billed insurers and recruited patients by taking them to strip clubs and casinos, as well as purchasing airline tickets to recruit out-of-state clients and giving patients cash, gift cards, and discounts on rent to entice them into the treatment facility.
A federal indictment alleges Eric Snyder fraudulently billed insurance companies for more than $58 million from 2011 to 2015. He owned a treatment facility, called Real Life Recovery Delray LLC, and a sober home where patients lived called Halfway There Florida LLC, also known as A Safe Place.
The investigation into Snyder’s facilities began in 2014.
Snyder allegedly employed a “junkie hunter” who recruited patients by paying hotel owners and front desk receptionists to call him if someone checked in who could be a potential treatment center client. One confidential witness alleged that a patient recruiter, Christopher Fuller, bought drugs for prospective clients.
In a Houston case, federal authorities allege a doctor at a pain management clinic issued unnecessary prescriptions for the opioid painkiller hydrocodone in exchange for $300 in cash per visit. The center saw 60 to 70 people a day and the clinic handed out more than 2 million illegal painkiller doses, officials allege.
Prosecutors in Michigan charged six doctors for their alleged role in billing for unnecessary prescription painkillers and charging Medicare $164 million for medically unnecessary drug tests and other procedures.