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10 indicted in $1.4B rural hospital fraudulent billing scheme: DOJ

June 30, 2020 / by Paige Minemyer

The Department of Justice (DOJ) has indicted 10 people, including a Miami-based hospital executive, in connection with a pass-through billing scheme that used rural hospitals as shells to submit fraudulent bills for lab tests.

Between November 2015 and February 2018, private plans were billed for $1.4 billion in tests and paid out $400 million, according to the DOJ. The indictment was unsealed Monday.

Hospital executive Jorge Perez, 60 of Miami-Dade County and nine others were charged in the indictment. Perez’s EmpowerHMS company at one time owned 18 rural hospitals, 12 of which have since gone bankrupt, Kaiser Health News reported last year. Eight have closed.

According to the indictment, Perez and his co-conspirators purposefully sought out struggling rural hospitals and would take them over to further the scheme. They would then bill private payers for pricey urinalysis drug tests and blood tests, which were largely conducted at outside labs they often controlled, according to DOJ.

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Mike Adams

Mike Adams is a medical device sales leader with extensive clinical experience in spine and biologics and a nationwide distribution network built over the last 10+ years in the industry. He has held various leadership positions in healthcare and device including Distributor Partner, Hospital COO and Spine VP of Sales. He currently leads the commercialization strategy for OrthoSpine Partners and is a Distributor Principal at Novel Medical. Because of his unique career path, Mike has the ability to see the healthcare business from multiple perspectives making him passionate about building strategic partnerships that help reduce overall costs, drive innovation, and cultivate growth for new markets.

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