| Mobilizing the troops
The Department of Justice launched a new strike force targeting healthcare fraud in Arizona, Nevada and Northern California. The new strike force — which the DOJ is calling its “West Coast” healthcare fraud strike force — comes seven months after the department launched a similar strike force going after healthcare fraud in Massachusetts. Why these regions?
The DOJ has recently pursued several massive fraud cases in Arizona tied to Medicaid billing, sober homes and wound care schemes that allegedly cost taxpayers billions of dollars. And in Nevada, federal officials have been investigating a sharp increase in suspected Medicare and hospice fraud, fueled in part by the state’s rapidly growing senior population. According to the most recent annual report that the Medicare Payment Advisory Commission (MedPAC) provides to Congress, hospice provider growth has exploded in a handful of states — including Arizona, Nevada and California — at a pace that far exceeds the rest of the country. The report highlighted several red flags that regulators commonly associate with fraud, including sudden spikes in the number of providers despite no matching increase in patient need, patients staying in hospice unusually long, clusters of providers operating from the same address, and patients frequently leaving hospice alive. California became such a concern that the state temporarily stopped issuing new hospice licenses and tightened oversight laws, the report noted. As for Northern California in particular, the region is an epicenter for the new AI tools that are becoming more and more embedded into the U.S. healthcare system. As AI and advanced technology continue to play a great role in fraud, the DOJ is sending more enforcement agents to the area to try to detect and disrupt complex schemes earlier and at scale. A new type of fraud risk
Mary Inman, a partner at Whistleblower Partners, highlighted an emerging fraud risk category in the healthcare vendor space, where companies are rapidly developing and then marketing AI tools for tasks like coding, billing and compliance. Sometimes, these startups overstate their capabilities or lack a true understanding of regulatory requirements, she said. “I call it ‘AI washing’ — a lot of vendors are trying to get a competitive advantage by saying, ‘We're applying AI,’ when sometimes they don't even have that ability. And most importantly, they may not have knowledge of the industry, but they use AI and the trappings of AI to try and get more customers,” Inman remarked. She noted that this is a type of healthcare fraud that hasn’t received much federal attention, but that could start to change if the DOJ continues to scale its enforcement efforts. — By Katie Adams |
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