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Attorney General Merrick B. Garland Delivers Remarks on a National Health Care Fraud Enforcement Action Resulting in 193 Defendants Charged and Over $2.75 Billion in False Claims


Washington, DC
United States

Remarks as Delivered

Good afternoon.

We are here today to announce the results of a two-week nationwide law enforcement action, across 32 federal districts, and against 193 defendants, for their roles in health care fraud schemes.

In addition to the charges and arrests being announced today, we are also announcing that we have seized over $230 million in cash, luxury vehicles, gold, and other assets in connection with these cases.

The Justice Department has been clear that we will bring to justice criminals who defraud Americans and steal from taxpayer-funded programs.

We take a particularly aggressive approach to combating health care fraud schemes that put people in danger for the sake of profits.

Our efforts to combat health care fraud are focused on four fundamental principles:

  • First: protecting vulnerable patients;
  • Second: defending taxpayer-funded programs;
  • Third: ensuring full accountability by prosecuting the perpetrators of these crimes and seizing their criminal proceeds; and
  • Fourth: using data analytics to keep pace with constantly evolving fraud schemes.

First, we are focused on protecting vulnerable patients.

In the Southern District of Florida, we charged three owners of a pharmaceutical wholesale company in a $90 million wire fraud conspiracy to distribute adulterated and misbranded HIV drugs to pharmacies and patients throughout the country.

We allege that the defendants purchased these drugs at steep discounts from black market suppliers and then resold them to pharmacies with falsified documentation designed to conceal the true source of the medication.

As a result, patients at times received bottles labeled as their prescription medication with entirely different drugs inside. One patient passed out and was unconscious for 24 hours after taking an anti-psychotic that he believed was his prescribed HIV medication.

In addition to protecting patients, our approach is guided by our commitment to protecting the taxpayer-funded programs they rely on.

That is why in the District of Arizona, we charged two wound-care company owners and two nurse practitioners in a $900 million Medicare fraud conspiracy targeting elderly patients.

In that case, we allege that the defendants caused unnecessary, highly expensive wound grafts to be applied to elderly Medicare patients — many of whom were terminally ill in hospice care. This was done without coordination with the patients' treating physicians and without proper treatment for infection.

Medicare paid the defendants more than $1 million per patient for these unnecessary grafts.

The third pillar of our approach is to ensure full accountability for these crimes — not just by charging and arresting those responsible, but also by seizing assets we allege have been stolen from taxpayers.

That is why in the case I just highlighted, we not only charged four defendants, but we also seized tens of millions of dollars in assets — including four luxury vehicles, gold, and bank accounts totaling more than $50 million.

The fourth pillar of our strategy is ensuring that we keep pace with constantly evolving health care fraud schemes. That includes addressing the rise of schemes that exploit telemedicine technology — specifically as it relates to Adderall and other stimulants.

Utilizing proactive data analytics, we identified misuse of telemedicine as a possible source of an increase in prescriptions for stimulants. Thereafter, we worked with law enforcement officers to identify potential schemes. Our investigation led us to a digital health care company called Done.

Earlier this month, we charged and arrested the former CEO and the clinical president of Done for their respective roles in a $100 million scheme to defraud taxpayers and provide easy access to Adderall and other stimulants for no legitimate medical purpose.

Today, we are also announcing that we have charged an additional five defendants for their alleged involvement in that scheme to distribute more than [40 million] medically unnecessary pills.

One of the defendants, who was among the company's largest prescribers, was indicted for rubber stamping prescriptions without any medical review. As alleged, the defendant also signed prescriptions for patients who were deceased.

I want to be clear: it does not matter if you are a trafficker in a drug cartel or a corporate executive or medical professional employed by a health care company. If you profit from the unlawful distribution of controlled substances, you will be held accountable.

The cases I outlined represent only a fraction of the broader actions that we are announcing today.

Earlier this week, I visited the U.S. Attorney’s Office for the Middle District of Tennessee in Nashville. I spoke with prosecutors who have investigated and charged two defendants with perpetrating a fraud scheme involving millions of dollars in fraudulent Medicare claims and kickback payments. The defendants were arrested on Monday.

This two-week period will be matched with sustained efforts by the Department’s Criminal Division in partnership with our U.S. Attorneys’ Offices nationwide to zero in on health care fraud schemes.

I want to thank the dozens of U.S. Attorneys’ Offices that investigated and prosecuted cases in their districts, the FBI, the DEA, and our partners from across the federal government. And I especially want to recognize the Criminal Division’s Health Care Fraud Unit for their leadership and their excellent work.

We do this work because we know that health care fraud is not a victimless crime.

We will continue to disrupt schemes that target patients at their most vulnerable. We will continue to defend taxpayer-funded programs from fraud. We will continue to bring justice to the perpetrators responsible for these schemes. We will continue to seize the funds they stole from taxpayers.

And as healthcare fraud schemes continue to evolve, so will the Justice Department’s investigative and prosecutorial strategies.

Our messages to those seeking to exploit patients and defraud government programs is clear: you cannot hide your crimes. We will find you, and we will hold you accountable.

Before I close, I want to address today’s Supreme Court order in Moyle v. United States. The Justice Department filed this lawsuit because the Emergency Medical Treatment and Active Labor Act (EMTALA) guarantees essential emergency care to all Americans, no matter which state they live in. If a patient comes into an emergency room with a medical emergency seriously jeopardizing the patient’s life or health, EMTALA requires hospitals to offer the treatment necessary to stabilize that patient, including pregnancy termination, if that is the treatment required to save a woman’s life or prevent serious harm to her health. Today’s order means that, while we continue to litigate our case, women in Idaho will once again have access to the emergency care guaranteed to them under federal law. The Justice Department will continue to use every available tool to ensure that women in every state have access to that care.

And now, I’m going to ask HHS Deputy Secretary Palm, if she would like to say a word.

Health Care Fraud
Updated June 27, 2024