DME Fraud

Durable Medical Equipment (DME) fraud remains a cornerstone of federal enforcement as seen in the recent takedown. An indictment in the Western District of New York charges a medical doctor with billing roughly $29.6 million for fictious DME and $5.6 million for audio-only telehealth visits, which were brief or never occurred. That doctor produced and maintained false and fictitious medical records and fraudulently certified orders for braces without regard to medical necessity. The doctor now faces federal criminal charges of conspiracy to commit health care fraud, health care fraud, and false statements relating to health care matters.

In “Operation Gold Rush,” prosecutors in the Eastern District of New York indicted 11 defendants, including two pharmacists, members of a transnational criminal organization based in Russia and Eastern Europe. These individuals allegedly orchestrated a massive Medicare fraud and money-laundering scheme that billed over $10.6 billion to federal health programs—making it the largest case by loss amount ever charged by the DOJ. The group used foreign straw owners to acquire dozens of U.S.-based DME suppliers, then submitted fraudulent claims for equipment such as urinary catheters and glucose monitors that never delivered, exploiting stolen identities and confidential patient data. To date, 19 defendants have been charged in the case, including multiple arrests abroad (Estonia) and at U.S. entry points.

COVID-19 Testing Kickbacks

COVID-19 testing kickback schemes typically involve health care providers or marketers billing Medicare for over-the-counter or lab-based COVID-19 tests that were unnecessary, never provided, or obtained through illicit referrals. These cases often rely on the same core tactics as DME fraud: using stolen or misused patient information, paying illegal kickbacks for referrals, and submitting inflated or false claims to federal programs. In both types of fraud, the perpetrators exploit gaps in oversight during high-demand periods—such as the pandemic or public health emergencies—to rapidly bill large amounts to Medicare, often with little or no patient interaction or verification.

These 2025 takedown includes criminal indictments and civil settlement agreements targeting this type of COVID-19 fraud. An indictment out of Illinois charged multiple individuals, including a physician, for their roles in a kickback scheme. According to the indictment, the defendants caused laboratories in Illinois and Texas to submit fraudulent claims to the HRSA COVID-19 Uninsured Program, ultimately receiving over $293 million in payments. The physician involved allegedly misused patient information—including data from a former hospital employer—to falsely claim that uninsured individuals had submitted samples for COVID-19 testing. In reality, many of the patients had not submitted samples at all. Defendants submitted claims through Texas labs they owned, despite those labs being non-operational. The proceeds were then laundered through various financial accounts to disguise the funds’ origin. Charges include wire fraud, conspiracy to commit money laundering, HIPAA violations, and conspiracy to defraud the United States. Authorities have seized a Rolls Royce Phantom and more than $104 million in assets linked to the fraud.

The charges being brought by the federal government in these cases carry significant criminal penalties and collateral consequences, especially for licensed medical professionals. At Conaway & Strickler, we are highly experienced in defending against these types of claims. Contact us to schedule a consultation and discuss your case.

The DOJ’s Health Care Fraud Unit coordinated the investigation with the help of strike forces across the nation. Key aspects of the historical take down include the following:

• Enormous monetary scale: Again, the federal government alleges $14.6 billion in intended losses in total across the criminal cases. Law enforcement has already seized $245 million in cash, luxury vehicles, cryptocurrency, and assets from alleged fraudsters. The Centers for Medicare and Medicaid Services (CMS) also proactively prevented $4 billion in fraudulent payments, suspended billing privileges of 205 providers.
• Civil charges and settlements: In addition to criminal charges being levied, law enforcement has also sought civil penalties from other providers and medical professionals. This includes civil charges against 20 defendants for $14.2 million in alleged fraud, as well as civil settlements with 106 defendants totaling $34.3 million.
• Transnational criminal networks: A major component—Operation Gold Rush—alleges a global ring used foreign straw owners to submit $10.6 billion in false claims for durable medical equipment. Though CMS blocked all but ~$41 million in Medicare payouts, insurers received about $900  Individuals abroad and co-conspirators in the U.S. used encrypted messaging and assumed identities to facilitate the purchase of medical supply companies and subsequent fraud by exploiting the stolen identities of over one million Americans spanning all 50 states and using their confidential medical information to submit the fraudulent claims.
• Telemarketing/genetic testing schemes: One $703 million scheme involved deceptive telemarketing, AI-generated “consent” calls, and stolen Medicare IDs—all to bill labs and DME suppliers
• Wound-care fraud on vulnerable patients: Roughly $1.1 billion in fraudulent Medicare submissions for amniotic allografts were applied to terminally‑ill or hospice patients, without medical need or oversight
• Opioid prescription diversion: 74 defendants, including 44 medical professionals, are accused of diverting over 15 million pills (e.g., oxycodone, hydrocodone), feeding the illegal drug trade
• Genetic testing & telemedicine: At least 49 defendants were tied to over $1.17 billion in telemedicine/genetic testing fraud, a key enforcement focus of the Takedown.

These are just some of the schemes and methods alleged as health care fraud. Additional cases totaling approximately $1.84 billion involved medically unnecessary tests and treatments, kickbacks, and stolen controlled substances. DOJ’s Health Care Fraud Unit, along with FBI, HHS‑OIG, DEA, CMS, and state AGs, led this nationwide operation. The Government was able to leverage cloud computing, artificial intelligence, and advanced analytics to identify emerging health care fraud schemes. Specifically, a new Data Fusion Center used AI to spot suspicious billing patterns

Professionals in the medical industry could face disruptions based on these trends. Individuals could be criminally indicted despite a lack of financial gain for any peripheral involvement in these schemes. With over 205 providers with billing privileges already suspended or revoked, firms must evaluate billing practices and ensure compliance before audits or criminal actions escalate. Medical professionals and individuals in the industry should be proactive in address any potential problems. Assessing practices through comprehensive billing audits, tightening consent documentation and patient qualification protocols, and reviewing prescribing practices are key to ensuring compliance.

Given the unprecedented scope of this takedown, anyone involved in Medicare/Medicaid billing—especially in telemedicine, genetic testing, wound care, DME supply, opioid prescribing—should evaluate their practices now. Protecting your license, assets, and reputation hinges on early legal counsel, transparent operations, and robust documentation. Upon any contact from law enforcement, individuals should secure legal counsel immediately. The presumption of innocence matters, and charges are allegations—not convictions. Early intervention and strong representation can shift outcomes. Medical providers should document everything diligently. Medical necessity, patient consent, referrals, and codes must be in writing and defensible.

Even if charges carry potential fines or incarceration, negotiated resolutions mitigating those consequences are viable. At Conaway & Strickler, we are highly experienced in federal health care fraud cases. Contact us to discuss your situation confidentially—we’re here to protect your rights and your future.

When the federal government is paying for items or services rendered to Medicare or Medicaid beneficiaries, federal fraud and abuse laws apply. Healthcare professionals influence what services patients receive and are responsible for the documentation of those services. That documentation is the basis for bills sent to insurers, and ultimately, the Government’s payment of a beneficiary’s medical claims.

If a physician knew or should have known that the submitted claim was false, the attempt to collect unearned money constitutes a violation. Federal fraud and abuse laws include the following:

• False Claims Act (31 U.S.C. §§ 3729-3733)
• Anti-Kickback Statute (42 U.S.C. §§ 1320a-7b(b))
• Physician Self-Referral (Stark Law).
• Exclusion Statute (42 U.S.C. § 1320a-7).
• Civil Monetary Penalties Law (42 U.S.C. § 1320a-7a).

These laws aim to prevent improper billing practices and financial incentives that could compromise patient care. These laws further grant powerful enforcement tools to federal agencies to penalize violations, ranging from civil fines to criminal charges.

The government can audit claims and investigate providers when there is a reason to suspect fraud. Unusual billing patterns or reports from others, including staff, competitors, and patients, may raise suspicion of fraud and abuse. If you’re a doctor who bills government healthcare programs, compliance with these rules and procedures is critical, as violations can lead to severe legal consequences.

One of the most critical aspects of government payer compliance is coding and billing insurers accurately for services rendered. Physicians may inadvertently engage in practices that violate federal billing regulations. Common billing violations include:

• Upcoding: Billing for more expensive services than those actually provided.
• Unbundling: Separately billing services that are typically bundled together.​
• Unnecessary Services: Providing services that are not medically necessary to increase reimbursement.​
• Kickbacks: Receiving or offering remuneration for patient referrals.
• Billing for services that an improperly supervised or unqualified employee performed.

In addition to maintaining compliance with billing regulations, these laws set forth requirements for maintaining accurate patient records, protecting patient privacy, and more.

Given the complexity and severity of potential penalties, healthcare professionals who find themselves under federal scrutiny for billing practices should seek the counsel of a federal criminal defense attorney as soon as possible. Physicians must be vigilant in adhering to federal billing regulations to avoid severe legal consequences. Understanding the legal framework and implementing proactive measures can safeguard against inadvertent violations and protect your practice’s integrity. Contact us to schedule a consultation.

Question: What types of issues come before the State of Georgia Nursing Board?

Answer: Below are some common issues the Board handles. Many of these issues may overlap, as most of this conduct also constitutes a crime.

1. Mishandling/misuse of drugs. This includes diverting medications intended for patients, taking medications for your own use, failing to document or inventory medications correctly, or submitting unauthorized prescriptions to pharmacies.
2. Sexual misconduct. This could include allegations of inappropriate sexual relationships with patients or sexually harassing colleagues.
3. Patient abuse or neglect. If a nurse physically, verbally, or mentally abuses a patient, or fails to provide them with timely or sufficient treatment, this could result in the loss of the nurse’s license.
4. Fraud. This may include allegations of falsifying patient records, misrepresenting credentials like education credits or diplomas, sending incorrect or inflated bills to insurance companies, etc.
5. Criminal convictions. Many convictions can disqualify nurses from practicing (such as driving under the influence or drug possession). Importantly, you can also lose your license if you do not disclose a past conviction (see below for more on the license renewal process).

Question: What happens when a complaint is filed against you?

Answer: If a complaint is filed against you with the board of nursing, the Board will review the complaint and open an investigation. If the allegations are serious, the board can issue an emergency temporary suspension of your license during the disciplinary process. Depending on the allegations, an investigator may be appointed to gather all necessary information, including documents, witness testimony, etc. The board may also ask you to submit a written response to the allegations in the complaint, along with any supporting evidence. The board will then decide whether there is enough evidence to support the allegations against you and move forward.

The Board may offer a consent order, allowing you to accept penalties without a formal hearing. The consent order typically involves admission to the wrongdoing and submitting to the disciplinary action recommended. If you decline, a formal hearing will be held, and disciplinary actions may follow. If no consent order is agreed to, you will be asked to appear at a formal hearing to defend yourself against the charges. After the hearing, the board will make a final determination. This could range from public reprimand to the suspension or revocation of your license. Even a minor disciplinary action can become a matter of public record, affecting your career and permanent reputation. It is critical to have a qualified attorney guiding you through this process.

Question: Why hire a nursing license defense attorney?

Answer: When a complaint is filed against you, the board of nursing does not consider you innocent until proven guilty, immediately putting you at a disadvantage. The Nursing Board’s primary goal is to protect the public, not defend nurses. With your career at stake, navigating the complexities of an investigation without legal assistance can be risky. Retaining a nursing license defense attorney ensures that your rights are protected, representing your best interests every step of the way.

Question: What if you are concerned about the license renewing process?

Answer: If you’ve been arrested or convicted since your last renewal, you need to proactively address these issues with the board. Building a mitigation packet and addressing any concerns early can significantly increase your chances of renewing your license without penalties. At Conaway & Strickle, PC, we are experienced in working with professionals to mitigate adverse Board actions related to arrests, substance abuse, and mental health issues. We can assist with not only getting your criminal case reduced or dismissed, but also renewing your license without sanctions.

Question: How can a DUI affect your nursing license in Georgia?

Answer: A DUI conviction in Georgia can result in probation and other penalties, such as random alcohol screenings, mental health evaluations, and restrictions on your nursing practice. These probationary conditions can last for years, depending on the severity of the case.

Below is a list of common probationary conditions that can be place on you following a DUI or an impaired driving under the influence of drugs charge in Georgia.

• Three years minimum probation (must be three years of continuous compliance, so the probationary period could be extended if you slip up)
• Psychotherapy Evaluation by a physician board certified in addiction medicine
• Psychotherapy Course of Treatment completion
• Quarterly Reports from Psychotherapist
• Mental and Physical Evaluation, with favorable finding pertaining to ability to perform duties
• Continuing Education Coursework
• Quarterly Reports from Employer
• Quarterly Reports from yourself
• Quarterly Reports from a Substance Abuse Treatment Aftercare program approved by the Board of Nursing
• Monthly PEth (blood alcohol) testing for first 12 months
• Bi-monthly random urine drug screens for duration of probationary period
• Random alcohol screens
• Enrollment in an Affinity Program, like the one offered by the Georgia Nurses Association
• Restrictions on nursing practice, often including an inability to practice in the following areas without prior Board of Nursing Approval: Agency/Pool Assignments; Private Duty Nursing; In-Home Nursing; Internal Float Pools; Travel Nursing; In-Home Hospice.
• Abstaining from alcohol, and mood-altering substances, including controlled substances unless prescribed.
• If prescribed any medication, providing a letter from the prescriber to both the Board of Nursing and the treatment/aftercare provider within 10-days of receiving such subscription.

Conclusion

If you’re facing challenges related to your nursing license, it’s important to act quickly. With the complexities of nursing board investigations and the potential damage to your reputation, having an experienced nursing license defense attorney is crucial. For more information, contact us today.

With all of this going on, the US Attorney’s office increased its prosecutions of individuals of white collar crimes in the year 2021. White collar charges like fraud, theft, corruption, bribery, environmental crime, tax fraud, health care fraud, procurement fraud, money laundering, PPP loan fraud, etc will continue to get more attention from the Department of Justice.

What does this mean? It means that investigations of any sort need to be taken seriously and that you should contact a lawyer immediately if any wrongdoing is alleged.

Conaway & Strickler, PC has a long history of handling fraud cases of all varieties and is well equipped at fighting the DOJ in their overzealous prosecutions. Please feel free to contact us so that we can help you avoid future headaches.