Dive Brief:
- The Department of Justice’s fraud division last week launched a strike force dedicated to rooting out healthcare fraud on the West Coast, as the Trump administration continues to double down on fraud enforcement across the country.
- The West Coast Health Care Fraud Strike Force brings the DOJ’s healthcare fraud unit together with the U.S. attorney’s offices for Arizona, Nevada and the Northern District of California, to coordinate on cases in the region, according to a Thursday press release.
- The strike force will bring increased enforcement resources to Northern California — one of the nation’s hubs for health technology development — and Arizona and Nevada, where the DOJ says healthcare fraud schemes are rising.
Dive Insight:
The Strike Force Model first launched nearly two decades ago has around 10 operations that largely target healthcare fraud, including regional divisions in the midwest, New England, Florida and Texas.
The method has become “one of the most powerful tools” to root out healthcare fraud, responsible for prosecuting more than 6,200 people who fraudulently billed federal healthcare programs and private insurers for more than $45 billion, according to the DOJ.
Prosecutors have been expanding the strike force model as they increasingly target health fraud cases. In the fall, the DOJ expanded its strike unit in New England to include healthcare fraud in Massachusetts, including cases involving pharmaceutical firms, medical device companies and providers.
Now, the department is setting up another strike force on the West Coast. Under the expansion, Health Care Fraud Acting Chief Jacob Foster and Acting Assistant Chief Gary Winters will work closely with the U.S. attorney’s offices in the three states, as well as the HHS’ Office of Inspector General, the FBI, the Drug Enforcement Administration and other law enforcement agencies, according to the press release.
The strike force comes as healthcare fraud has increased in the region, the DOJ said. For example, in December owners of multiple wound graft companies in Arizona were sentenced to at least 14 years in prison for billing Medicare and other insurers more than $1.2 billion in false and fraudulent claims.
And leaders of a telehealth company were convicted in November for illegally distributing Adderall and other stimulant drugs and submitting fraudulent claims for reimbursement.
“Silicon Valley has become ground zero for technology-driven health care fraud schemes that seek to cheat taxpayer-funded programs like Medicare,” Craig Missakian, U.S. attorney for the Northern District of California, said in a statement Thursday. “The Health Care Strike Force announced today is a powerful partnership that brings together the resources and expertise needed to detect and dismantle even the most sophisticated fraud schemes.”
Targeting fraud in healthcare and benefits programs has been a priority for the second Trump administration.
The CMS has launched inquiries into Medicaid fraud in several states, including California. CMS Administrator Dr. Mehmet Oz visited the state earlier this year to dicuss healthcare fraud, and launched a probe into its Medicaid spending. Last month, the DOJ announced multiple providers in California had been arrested for alleged hospice fraud. Oz has said he wants all 50 states to audit providers in their Medicaid programs.
While Republican lawmakers have cheered moves to target fraud, Democrats say the Medicaid enforcement has largely focused on blue states.
The CMS has also halted around $250 million in federal funds to Minnesota in February due to allegedly fraudulent claims. Last week, the Trump administration said it would defer another $91 million in Medicaid funds to the state.
