On Monday, August 13, 2018, the U.S. Department of Justice (DOJ) announced the newest Medicare Fraud Strike Force cities: Newark and Philadelphia. The newly formed Newark/Philadelphia Regional Medicare Fraud Strike Force will target both traditional criminal health care fraud and opioid over-prescription, and is the first of its kind to have a specific focus on targeting opioid overutilization, a major priority of Attorney General Jeff Sessions.
Historically, DOJ’s Medicare Fraud Strike Forces have focused on criminal heath care fraud being committed by health care providers, such as doctors, physical therapists and other licensed individual providers, as well as hospitals, clinics and home health care agencies. The hallmark of the Strike Force’s investigative style is twofold: (1) prosecutors and agents who are highly trained in, and focus mostly on, the investigation and prosecution of criminal health care fraud; and (2) the use of data to identify criminal targets. Unlike other areas of health care fraud enforcement that leverage whistleblowers and qui tam filings, the Strike Force has traditionally relied on sophisticated data analysis to identify billing irregularities (such as spikes, outliers and high volumes of lucrative billing codes) that are considered to be “badges of fraud.”
The Strike Forces represent a partnership between the Department of Justice’s Criminal Division, Fraud Section at Main Justice in Washington, D.C.; U.S. Attorneys’ Offices around the country; the FBI; and Department of Health & Human Services Office of Inspector General (HHS-OIG).
Before the rollout of the new Newark/Philadelphia Strike Force, there were Medicare Fraud Strike Forces in 10 cities across the United States, located in Baton Rouge, Brooklyn, Chicago, Dallas, Detroit, Houston, Los Angeles, Miami, New Orleans and Tampa. In addition, the Fraud Section operates a Corporate Strike Force out of Washington, D.C.
Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,700 defendants, making it the major player in the criminal health care fraud enforcement space. Of note was last month’s health care fraud “takedown,” the largest in history, which netted 601 arrests, including 162 individuals accused of prescribing and distributing opioids and other narcotics.
The new Newark/Philadelphia Strike Force will be made up of prosecutors and data analysts with the Fraud Section, prosecutors with the U.S. Attorneys’ Offices for the District of New Jersey and Eastern District of Pennsylvania, and special agents primarily with the FBI, HHS-OIG and Drug Enforcement Administration. In addition, expect to see participation by other law enforcement agencies, including the U.S. Postal Inspection Service, IRS Criminal Investigation Division and the Medicaid Fraud Control Units (MFCUs) of New Jersey and Pennsylvania.
The Fraud Section’s expansion into the Newark/Philadelphia area represents a natural next step of the Strike Force’s mission to focus on the geographic areas of the country that appear to have the worst health care fraud problems. In-house counsel and executives at health care companies in that area should take note.