Charges Revealed for Largest Criminal Healthcare Fraud Case in History

Last month, the Justice Department announced charges for the largest criminal healthcare fraud case in U.S. history – a case involving over $1 billion in fraudulent Medicare charges.

Three co-defendants – including Philip Esformes, the owner of a network of nursing homes and assisted living facilities in South Florida – were charged with masterminding an elaborate scheme by which doctors, healthcare providers, and hospitals were fraudulently billed, often for treatments that were deemed to be medically unnecessary and even harmful.

In many cases, patients were moved from one facility to another as they reached limits on their length of stay. This allowed the co-defendants to essentially bill Medicare for even more.

In the indictment, the Justice Department alleges that the individuals paid bribes and kickbacks in order to direct patients to facilities under Esformes’s control. They also received bribes from co-conspirators who were also named in the indictment; these bribes were often disguised in a variety of ways, such as pretending the kickbacks were in the form of charitable donations.

The result: the co-defendants allegedly received tens of millions of dollars in illicit funds through the illegal actions they took, from 2009 to 2016.

This is not the first time Esformes was involved in a healthcare fraud scheme. In 2006, he and other co-defendants had to pay $15.4 million in a civil healthcare fraud case that, in many ways, was similar to the charges levied against them in July.


Healthcare fraud is prevalent, primarily because it’s lucrative. Esformes and his co-defendants allegedly took in millions before they were caught – and there’s no guarantee that perpetrators will ever be caught.

One of the first lines of defense (and in some cases, the only line of defense) is a person on the inside who is brave enough to alert authorities when they suspect illegal activity. The alleged behavior could have been ended years before if an employee had noticed anything suspicious and notified authorities.

Unfortunately, many of us do not take action, mainly because we fear repercussions and don’t want to lose our jobs, or be blacklisted in the industry by our employers.

To provide an incentive for whistleblowers to act, the federal government has passed what is called qui tamlegislation. The False Claims Act, originally passed in 1863 by the Lincoln Administration and subsequently modified over the years, allows for a financial reward to be given to a whistleblower if they bring forth evidence of fraud and the government collects from the defendant(s) in a civil case. The whistleblower is awarded a percentage of the total amount recovered by the government, usually between 15 and 30 percent.

In addition, the False Claims Act also provides for protections and compensation for whistleblowers if they are threatened, harassed or terminated by their employer or contractor for their attempts to stop one or more false claims.

If you or someone you know is in a position to provide grounds for a qui tam lawsuit against an entity that is engaging in healthcare fraud or any other type of fraud on the federal government, you should immediately contact awhistleblower attorney. The attorney can provide you with guidance, including what you should do next. The attorney will also take steps on your behalf to protect you under the law and help you move the qui tam lawsuit forward.

Often, the only way fraud can be discovered and punished is if whistleblowers come forward. A whistleblower attorney can help whistleblowers take action, and, with a successful resolution of the case, receive a financial reward.

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