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Law & the Courts

Feds Charge 24 People in $1.2 Billion Medicare Scam

The Justice Department building stands in Washington, D.C., February 1, 2018. (Jim Bourg/Reuters)

The Justice Department announced charges on Tuesday against 24 individuals allegedly involved in a $1.2 billion Medicare scam.

The scammers, who included doctors accused of writing fraudulent prescriptions, owners of call centers in the Philippines and Latin America, and medical-device companies, allegedly contacted Medicare beneficiaries offering “free” orthopedic braces that they claimed were covered by Medicare. Interested patients were patched through to the call centers, which verified Medicare coverage and collected prescriptions, which they then sold to the medical-equipment companies. The companies mailed out the braces to seniors and sent the bills to Medicare, which reimbursed the companies between $500 to $900 for each brace. The companies then paid about $300 in kickbacks per brace.

All told, 130 medical-equipment companies involved in the scheme are said to have charged Medicare $1.7 billion, of which $900 million was paid out. The FBI, IRS, and 17 U.S. attorney’s offices were involved in breaking up the fraudulent scheme, which was first uncovered last summer, when the Medicare-fraud hotline started receiving complaints from beneficiaries.

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