White-Collar Crime

According to the FBI, for many of its fifty-six field offices across the nation healthcare fraud is the number one white-collar crime. During the 1990s and into the twenty-first century the number of healthcare cases under investigation increased rapidly. Defrauding Medicare (the national healthcare insurance plan for U.S. seniors) out of millions of dollars became the primary healthcare fraud problem. Medicare health fraud has unnecessarily increased federal spending. For example, privately-owned home healthcare agencies, hospitals, nursing homes, physicians, and related healthcare professions have been found to bill Medicare for services never performed or to exaggerate expenses for more Medicare funds.

In the late 1990s the largest certified home healthcare agency in Miami, Florida, billed Medicare for services that were not provided, for unnecessary services, and for services to people In 1997 U.S. attorney Jackie Williams, left, and FBI special agent David Tubbs announced a sixty-three-count indictment in a Medicare fraud scheme involving five hospitals in Missouri and Kansas. (AP/Wide World Photos) not eligible for Medicare, including those who had already died. Medicare paid out $120 million for these services. After five years of investigation, twenty individuals associated with the home care agency were convicted for defrauding Medicare. The federal government estimates that over $100 billion annually in federal healthcare expenditures are for fraudulent claims. Private healthcare insurers are also victims of fraud.

In March 2004 two Orange County, California, residents were convicted of defrauding both Medicare and private health insurance companies. A Garden Grove pharmacy owner gathered patient and doctor identifications from legally filled prescriptions and used the information to submit false claims to insurance companies. He submitted claims of over $5 million. Once insurance companies caught up with him, he transferred his pharmacy to a colleague who opened another pharmacy and proceeded to charge $1 million more in false claims before being caught. Some claims involved up to twenty or more prescriptions for a single patient. Others were fake prescriptions for elderly patients written by pediatricians (children's doctors). Still other prescriptions carried the forged signature of a doctor who saw only prison inmates.

In another pharmacy related incident, millionaire pharmacist Robert R. Courtney of Kansas City, Missouri, pleaded guilty to diluting cancer fighting drugs then delivering the premixed drugs to doctors' offices for patients. Investigators found premixed chemotherapy drugs at Courtney's Research Medical Tower Pharmacy that were diluted to between 13 and 53 percent of the correct strength. A drug representative from Eli Lilly Company discovered the scam after noticing Courtney had billed physicians for much more of the drug Gemzar than Courtney had ever ordered from Lilly. Doctors use Gemzar to treat pancreatic and lung cancer.