Federal authorities derailed a $279 million fraud ring in New York yesterday that involved 10 physicians and charges of healthcare fraud, federal racketeering and money laundering, according to a Wall Street Journal report.
In total, 36 people were allegedly involved in the scheme that has been in operation since 2007. The ring allegedly operated a chain of medical clinics in New York that exploited the state's no-fault insurance law, which lets car accident victims get up to $50,000 in benefits per person regardless of fault.
Patient recruiters would send car accident victims to corrupt clinics in exchange for kickbacks. Physicians would then prescribe a variety of treatments to each patient regardless of their condition and bill auto insurers for the unnecessary treatments. While false claims totaled $279 million, the loss to private insurers was $113 million, according to the report.
Defendants are also accused of laundering money from the false billing into shell companies. If convicted of the most serious charges, many of the defendants face up to 20 years in prison, according to the report.
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In total, 36 people were allegedly involved in the scheme that has been in operation since 2007. The ring allegedly operated a chain of medical clinics in New York that exploited the state's no-fault insurance law, which lets car accident victims get up to $50,000 in benefits per person regardless of fault.
Patient recruiters would send car accident victims to corrupt clinics in exchange for kickbacks. Physicians would then prescribe a variety of treatments to each patient regardless of their condition and bill auto insurers for the unnecessary treatments. While false claims totaled $279 million, the loss to private insurers was $113 million, according to the report.
Defendants are also accused of laundering money from the false billing into shell companies. If convicted of the most serious charges, many of the defendants face up to 20 years in prison, according to the report.
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