Wherever there is paid medical care, there is fraud. And so it goes with the scourge of the 21st Century, Covid-19.  As detection, testing, treatment, and vaccination have all come to life, and then become common as a reality of 2020 and 2021, the hucksters have, regrettably, been not far behind. According to John M. LeBlanc, a nationally known healthcare lawyer with law firm Manatt LLP, cases of fraud have matched the rise of both the disease and the prevention.  The scams and misdeeds are not a pretty sight.

John LeBlanc of Manatt points to a U.S. Acting Assistant Attorney General, who said in March: “To anyone thinking of using the global pandemic as an opportunity to scam and steal from hardworking Americans, my advice is simple—don’t.”

As the race to vaccinate continues, state and federal law enforcement agencies are hard at work investigating and prosecuting COVID-19-related health care fraud, John LeBlanc says. 

John LeBlanc, who is based in Manatt’s Los Angeles office, has more than 28 years of experience, focusing primarily on litigation and regulatory matters affecting the health insurance and managed care industries. He represents many of the nation’s leading insurers and health plans, including the largest not-for-profit health care service plan in California. He also represents some of the health insurance industry’s top trade associations

Misappropriation of Funds From the Provider Relief Fund LeBlanc points to one of the biggest sources of medical fraud as one of the medical system’s greatest sources of relief, as well–the CARES Act, also called the Provider Relief Fund.  “A likely target of increased governmental focus are those who received funds from the Fund,” John LeBlanc of Manatt says. “The funds are…distributed by grants or other payment mechanisms to eligible health care providers to reimburse them for health care-related expenses or lost revenues attributable to COVID-19. [But] all health care providers retaining payments from the Provider Relief Fund must certify that the funds will be used for only these purposes and must attest to the terms and conditions associated with the payments and ‘any other relevant statutes and regulations.”

Sure enough, this last February, the Department of Justice indicted the first person in the nation accused of misappropriating money from the Fund, charging a Michigan woman with embezzlement of government property.  “The indictment alleges that the woman had previously owned a home health care facility that closed in early 2020 after Medicare demanded the return of more than $1 million in overpayments,” John LeBlanc of Manatt says. “The facility submitted claims for patients who did not qualify for home health services. According to the indictment, the provider was never operational during the pandemic, yet it received over $37,500 from the Provider Relief Fund—funds that were then given to family members for personal use.”

Counterfeit Vaccines, Medical Supplies and Vaccination Records

Others have now been found guilty of peddling counterfeit medical supplies, LeBlanc attests.  This is a particularly bad development, he notes, at a time when health concerns and some Americans’ doubts about treatment and vaccination are already at an all-time high. “Internationally, counterfeit COVID-19 vaccines have already been identified, and this practice may worsen as the vaccination rollout continues,” LeBlanc says. “In April, Pfizer Inc. identified the first confirmed instances of counterfeit versions of its vaccine in Mexico and Poland. And as businesses make return-to-work plans and schools welcome back students, knowing how to spot counterfeit medical supplies may prove critical so that only authentic medical supplies are used to combat the spread of COVID-19.” He added, “Vaccine hesitancy and the possibility of vaccine mandates in the education, work and travel spheres have already generated schemes to manufacture and distribute counterfeit COVID-19 vaccination cards—schemes that may result in prosecutions.”

Counterfeit Medical Equipment

The phony medical equipment is not limited to vaccines, John LeBlanc of Manatt notes; some medical hardware has been implicated as well. “The CDC…issued guidance to help consumers spot counterfeit respirators, noting that a respirator may be counterfeit if there are no markings designating the respirator as a National Institute for Occupational Safety and Health (NIOSH)- approved device,” LeBlanc says.  “The CDC also noted that when buying medical supplies from third-party marketplaces or unfamiliar websites, buyers should watch out for warning signs like a listing claim that the medical product is ‘legitimate’ or ‘genuine,’ and whether the seller seems to market trendier items rather than consistent items over a longer period of time.

In brief, just as the government develops and disseminates good and helpful assistance to the medical establishment for dealing with the pandemic, those who would cheat the system did what Deep Throat suggested in the days of Watergate: “follow the money.” Practitioners and patients alike would be well-advised to remain aware of those looking to cheat the system, and to illicitly put government money in their own pockets.