Sham promises of grand prizes and get-rich-quick programs. Warnings of concocted computer viruses designed to wipe out your entire network. Threats of fines and jail time for trumped-up transgressions on your taxes.
Fraud schemes are plaguing senior living residents and other older adults with an ever-increasing ferocity and level of sophistication. Fortunately for the more vulnerable among us, the government is broadening its enforcement umbrella. And it means heightened scrutiny and reporting responsibility for those providing care and services to older adults.
Recent elder fraud sweep sets record
In its most recent effort to crack down on elder fraud, the Department of Justice announced what it said was the country’s largest-ever coordinated sweep to protect this most vulnerable segment of our population. The year-long sweep coupled civil lawsuits and criminal indictments with consumer education efforts going back to March 2018, reaching every state in the country and deploying resources at the state, local and federal levels. The coordinated cases, and the federal government’s pointed efforts to publicize them, send a clear message: schemes that victimize the elderly will be a top priority for law enforcement.
As you read previously in McKnight’s Senior Living the sweep reached more than 260 defendants accused of defrauding some two million Americans of nearly $750 million. It follows a similar sweep last year that affected nearly one million Americans and involved 250 defendants and more than $500 million. This enforcement surge comes on the heels of the late 2017 passage of the Elder Abuse Prevention and Prosecution Act, one of the few bipartisan accomplishments to emerge of late.
Although the frauds varied, this year’s sweep devoted particular attention to tech support and mass mailing schemes. In a typical tech support scam, fraudsters call an individual, pose as a technician from a respected company, and then claim that they have found viruses or other malware on the individual’s computer. Or the fraudsters cause a pop-up ad to appear on the victim’s computer, likewise claiming that the computer has been infected. In either situation, the caller or the pop-up offers technical assistance, asking the victim for remote access to their computer to “diagnose” the problem. But the end game is the same: there’s always a problem to be fixed, and a price to pay to fix it. Less tech-savvy older Americans are prime targets, and the government describes these schemes as flourishing.
Although perhaps lower-tech, mass mailing schemes have been no less pernicious. Through these schemes, which have been around for decades, fraudsters send letters directly to older individuals promising cash awards, prizes or other services in exchange for taxes or processing fees. The letters often are personalized and printed on official-looking letterhead.
In one particularly egregious case, New York prosecutors charged several individuals with bilking 1.4 million Americans out of $180 million over the course of two decades. The alleged perpetrators reportedly singled out elderly and vulnerable individuals to receive letters from purported “psychics” claiming they could help the recipient avoid bad fortune — for a price.
Other alleged fraudsters caught in the sweep preyed on elderly victims by offering bogus investment vehicles. In Atlanta, the U.S. attorney charged a stockbroker with soliciting investments from veterans and residents of assisted living communities through purported retirement-planning seminars. Rather than invest the money, the man allegedly pocketed more than $1 million, buying Super Bowl tickets and luxury vacations.
False Claims Act cases filed against providers
Although the sweep primarily reached alleged financial crimes committed by small-time scoundrels, the Justice Department also has been going after corporations for various healthcare practices deemed to have harmed the elderly. Just last month, for example, the Department reached a $19 million settlement with Tennessee nursing home operator Vanguard Health for reportedly providing substandard care to its residents. The department sued the company under the False Claims Act, which prohibits defrauding government programs such as Medicare and Medicaid and allows both the government and whistleblowers to bring lawsuits against those are thought to have done so.
In the Tennessee case, the government alleged that nursing home residents received care so poor that it essentially was worthless — and then billed Medicare for it. The operators allegedly neglected residents’ basic hygiene and nutrition needs and failed to administer medications, provide wound care and perform standard infection control.
And in another False Claims Act case, against Kentucky-based nursing home operator Signature Healthcare, the government recovered more than $30 million in connection with alleged abusive practices. That company allegedly forced sick residents to receive unnecessary therapy when it helped the bottom line, but discouraged other residents from receiving necessary therapy when it hurt it. In prosecuting the Tennessee case, the Justice Department promised to aggressively pursue nursing home operators “that put their own economic gain ahead of the needs of their residents.”
The government similarly has put the home healthcare and hospice industries on notice. Last year, courts unsealed 21 False Claims Act suits against companies in these industries, which overwhelmingly serve elderly Medicare and Medicaid beneficiaries. One of those companies, a Brooklyn, NY-based agency, agreed to pay more than $6 million for systematically billing the government for home health aide and personal care services it simply never provided to its homebound patients. The government also charged a group of individuals in Florida in connection with a $66 million conspiracy to recruit patients to receive home healthcare, only to leave those patients without care.
Elder fraud a top priority
Our new attorney general, William Barr, has wasted little time in speaking out against elder fraud, which, in announcing the March sweep, he promoted as one of the government’s top enforcement priorities.
“Crimes against the elderly target some of the most vulnerable people in our society. …The Trump administration has placed a renewed focus on prosecuting those who prey on the elderly, and the results of today’s sweep make that clear,” he said.
What’s coming, and actions to take
In the coming months, we can be sure to expect news of additional civil and criminal enforcement actions against individuals and companies who seek to unfairly profit off the backs of older Americans. Although the government announced these actions on a single day, the lawsuits and criminal complaints were filed throughout most of 2018 and resulted from months, if not years, of investigation.
Providers caring for the elderly population, particularly in senior housing or long-term care settings, should expect increased contact from law enforcement agencies investigating telemarketing, mailing and other scams. Also keep an eye out for unusual calls and visitors to those receiving services and care in your community, and report suspicious conduct to the Federal Trade Commission and the Justice Department’s Office for Victims of Crime.Providers also always should be on alert for internal compliance failures, particularly those that pose a risk of harm to their residents and patients. Whether services are being underprovided, overprovided or not provided at all, seeking to remedy the issue and self-disclosing to the Health and Human Services Office of the Inspector General and other authorities, where applicable, always should be a company’s first choice. But if the problem persists without internal remedial action, then seeking legal representation to help stop the harmful practices may be your next best option.