Sentences Handed Down in $45 Million Medicare Fraud Scheme

September 25, 2012

South Florida is once again in the headlines as major players in a Medicare fraud scheme received lengthy federal prison sentences. Luis Alejandro Sanz and his wife entered pleas for their involvement in what the government alleged was a $45 million Medicare fraud scheme. The indictment alleged that the defendants through Ideal Home Health, billed Medicare $45 million for nursing services provided to homebound diabetes patients. Of the $45 million billed, Medicare returned $30 million in taxpayer money. The Sanzes appeared with their Miami criminal attorneys at their sentencing hearing. Luis Sanz received a ten year prison sentence, while his wife Elizabeth received a nine year prison sentence.

The government alleged that Luis after being released from prison on cocaine trafficking charges, began his new criminal enterprise of Medicare fraud. Luis put the business in his wife's name to conceal the fact that he had a prior felony record and state prison sentence. The business operated between 2006 and 2009. Once uncovered, the federal government's investigation revealed one of the largest cases of Medicare fraud in the country's history. The investigation has led to 25 fraud convictions with more indictments expected. The judge when handing down the sentence, said the couple made a mockery of the federal healthcare system.

The government alleged at the sentencing hearing that the defendants purchased a $1.3 million home with the ill-gotten gains and that kickbacks were paid to both patients and recruiters to facilitate the fraud. The government also mentioned that Medicare should not be blamed for the oversight as the defendants made the illegal business appear to be legitimate. As soon as Luis finished his five year prison sentence for cocaine trafficking and money laundering, he contrived the fraud and put his wife in charge of the company to avoid detection of his criminal record. The indictment alleged that Elizabeth ran the business and accused her of forging doctor's signatures, altering medical records and filing false claims.

According to the prosecutor handling the case, many drug traffickers engaged in Medicare fraud once they had completed their prison sentences. A defendant previously convicted of drug trafficking opened mental health clinics in Cutler Bay and in the Kendall area. Upon discovering that the feds were investigating him, he moved his operation to North Carolina. He has since been arrested with eight co-conspirators for billing $63 million dollars in fraudulent claims to the federal government. Another alleged drug dealer opened 11 medical equipment companies using Cuban migrants as straw owners, eventually billing Medicare $48 million. He is currently serving a 20 year sentence.

To prevent ongoing fraud, Medicare has implemented a more proactive approach with the assistance of $350 million dollar grant to develop a more strict screening process along with software used to detect fraudulent Medicare claims. Medicare is also demanding that providers who have a historic risk of fraud, like medical equipment suppliers and home healthcare suppliers, undergo extensive screening, including FBI background checks and fingerprinting. The changes in better being able to detect fraud come as a result of the massive fraud that has occurred in Miami and Florida as a whole.

Medicare Fraudsters Sentenced to Prison after $45 Million Scheme, CBSLocal.com, September 15, 2012.