20 charged in Medicare fraud bust in California

LOS ANGELES — Federal authorities have charged 20 people, including clinic owners and patient recruiters, in a scam they say fraudulently billed Medicare about $26 million.

The indictments came as part of an ongoing crackdown on Medicare fraud as President Barack Obama pursues health care reform.

Arrests were made Wednesday in the Los Angeles area after seven suspects were taken into custody last week, said Thom Mrozek, a spokesman for the U.S. attorney's office.

Medicare was fraudulently billed for pricey medical equipment such as power wheelchairs and hospital beds that were not needed, he said.

In Washington, Lanny Breuer, head of the Justice Department's criminal division, said the arrests were further proof of the intense pursuit of Medicare fraud.

Working as part of a Medicare fraud strike force, agents in Los Angeles, Miami, Houston and Detroit have been involved in the indictment of 331 people across the country since March 2007.

Breuer said some of the schemes involved "wheelchairs that went to people that never needed them, wheelchairs that went to people that never received them, and wheelchairs that were purchased by people who were already deceased."

Gang involvement was alleged in some of the latest charges.

Michael Martinez, 30, of Long Beach, was accused of recruiting relatives and others linked to a Santa Ana-based gang to act as straw owners of four fraudulent medical equipment companies, according to the Department of Justice.

He could face a maximum of 75 years in prison if convicted.

All but one of the suspects were made in California. The other was a Las Vegas resident.

It was the fourth major sweep since U.S. Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius announced in May they were adding millions of dollars and dozens of agents to combat a problem that costs the nation an estimated $60 billion a year.

Critics blame the Centers for Medicare and Medicaid Services for a lack of oversight in the program that cares for the nation's seniors.

The fight against fraud has found new allies as the program comes under greater scrutiny in the national health care debate.

Obama has vowed to fix the system with the help of funds recovered through such busts.

The strike force was launched in 2007 in Miami, the site of more than $3 billion a year in Medicare fraud involving wheelchairs, home health care, physical therapy and infusion drugs.

As more dangerous criminals are drawn to what was once a white-collar crime, authorities are seeing more violence to settle debts. The tactics include professional hits that generally go unsolved, said Los Angeles County sheriff's Sgt. Stephen Opferman.

Under current laws, criminals with violent records, including a convicted murderer, have been able to obtain Medicare supplier licenses. Applicants with felony records can only be rejected if their convictions occurred less than 10 years ago.

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On the Net:

http://www.hhs.gov/stopmedicarefraud