Miami Herald - May 10, 2007
Lesley Clark, lclark@MiamiHerald.com

They said the arrests -- mostly across Miami-Dade County -- are the result of a two-month probe by a team of federal, state and South Florida investigators who have been concentrating on Medicare fraud, practiced in an array of various schemes.

U.S. Attorney General Alberto Gonzales said South Florida was chosen to launch the strike force because "it is one area, among others, where we believe Medicare fraud is prevalent."

Said U.S. Health and Human Services Secretary Michael Leavitt, who recounted for reporters a recent tour of so-called "durable medical equipment providers" in Miami:

"This kind of blatant fraud simply is intolerable." The companies purport to provide medical equipment, including wheelchairs and prosthetic limbs, but Leavitt said, most of the offices were empty, with only a name, phone number and alleged business hours posted on the door.

'DOOR AFTER DOOR'

"Door after door after door," Leavitt said. "It was a shocking level of fraud to me."

The arrests included a sweep Tuesday that netted 24 people suspected of operating such phony medical equipment supply companies.

In one example, two companies owned by Miami-Dade resident Eduardo Moreno allegedly billed Medicare for more than $1.9 million worth of services that were not medically necessary. The FBI has seized some of Moreno's assets, officials said, providing reporters with a photograph of what they said was Moreno's 2004 Rolls Royce Phantom -- worth about $200,000.

"Where fraud like this occurs, it is a perversion of our healthcare system," said Gonzales, who, on the eve of his return to testify before Congress about his role in the firings of U.S. attorneys, appeared with Leavitt at the press conference.

Gonzales said that some of the 38 defendants allegedly paid Medicare recipients for use of their Medicare card numbers so that the defendants could submit fake claims.

"We believe scores of shell companies have opened and obtained Medicare supplier numbers in Miami-Dade County alone," Gonzales said.

Another scheme targeted by the task force is fraudulent HIV infusion clinics, where operators pay off doctors to issue unneeded prescriptions to patients, who in turn are paid for the use of their Medicare cards. In some cases, Gonzales said, patients receive no medication, or the wrong medication, putting them at risk.

In one case provided to reporters, prosecutors said two defendants engaged in an "infusion therapy scheme," for patients who did not need the drugs that were allegedly used. The indictment says the pair billed Medicare for nearly $1 million in just 9 months.

THE STRIKE FORCE

The strike force, which began working March 1, includes federal prosecutors, the FBI, the Health and Human Services inspector general and state and local law enforcement in South Florida, Gonzales said.

It uses real-time analysis of Medicare billing data to identify suspicious transactions and potential offenders, Gonzales said.

He noted that the strike force's creation was prompted by the "amount of money being stolen from the Medicare system and the flagrant nature" of the theft.

The federal government has been criticized for not going after fraud more aggressively but Leavitt said reforms are underway. He said the agency wants to strengthen its requirements to screen out sham providers and beef up scrutiny of existing suppliers.

"We're sending a clear message to those who commit fraud will not be tolerated and we're coming after them," he said.

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Miami Herald staff writer John Dorschner contributed to this report.
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