White Collar and Health Care: Medicare Fraud Ring Charged in Miami

A federal grand jury in Miami has indicted eight persons in connection with a Medicare fraud ring. The indictment charges that Michel De Jesus Huarte is at the center of the scheme. It alleges that Huarte organized two conspiracies to defraud Medicare.

Both schemes involved the billing of Medicare and private insurers operating programs for Medicare through the Medicare Advantage plans. The defendants billed the government for HIV infusion therapy that had not taken places. Infusion therapy is an obsolete treatment for HIV patients, having been replaced more than a decade ago, by antiretroviral drugs. In the schemes Huarte and others obtained the cooperation of others to pose as the owners of the medical treatment facilities. These "straw men" owners were to leave the country to avoid detection and arrest. Using these fronts, Huarte and others would bill the government for infusion therapy that was neither prescribed or administered.

The schemes were alleged to have covered five southern states: Florida, Georgia, Louisiana, South Carolina, and North Carolina. The government alleges that the defendants were able to bilk Medicare of tens of millions of dollars through the schemes' operations. Huarte and a co-defendant deposited Medicare checks at two Miami check cashing stores. Once the checks cleared, the check cashing establishments would make multiple weekly cash payments of between $30,000 and $80,000.

The prosecution grew out of a joint HHS and DOJ task force. The Miami task force is one of four throughout the country. The others are in Los Angeles, Houston, and Detroit.

For an in depth discussion of the scam, please see The Miami Herald, "Feds: Fraud Ring Spanned 5 States," June 24, 2009, p.1A.