Miami-based Orthodox Jew Philip Esformes has been convicted of America’s largest ever health care fraud which saw him steal more than $1.3 billion from American taxpayers. He has been officially described as a “parasite” by investigators from the US Department of Justice.
According to a statement released by the US Department of Justice, a federal jury found Esformes guilty “for his role in the largest health care fraud scheme ever charged by the Justice Department, involving over $1.3 billion in fraudulent claims to Medicare and Medicaid for services that were not provided, were not medically necessary or were procured through the payment of kickbacks.”
After an eight-week trial, Esformes was convicted of one count of conspiracy to defraud the United States, two counts of receipt of kickbacks in connection with a federal health care program, four counts of payment of kickbacks in connection with a federal health care program, one count of conspiracy to commit money laundering, nine counts of money laundering, two counts of conspiracy to commit federal program bribery, and one count of obstruction of justice before U.S. District Judge Robert N. Scola Jr. of the Southern District of Florida. Sentencing has not yet been scheduled.
“Philip Esformes orchestrated one of the largest health care fraud schemes in U.S. history, defrauding Medicare and Medicaid to the tune of over a billion dollars,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.
“I commend our dedicated prosecutors and law enforcement partners for their professionalism and unyielding pursuit of justice on behalf of American taxpayers and vulnerable beneficiaries who, as a result of Esformes’s crimes, were denied the level of care that they needed and deserved.”
“Philip Esformes’ criminal scheme defrauded America’s health care system out of millions of dollars, that would have otherwise provided quality care to patients in need,” said U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida.
“I commend the Assistant U.S. Attorneys from the Southern District of Florida, who worked tirelessly alongside their partners at the Department’s Criminal Division, the FBI and HHS-OIG to bring this case to justice. This massive fraud scheme, perpetuated in nursing and assisted living facilities in our South Florida communities, compromised the integrity of our local health care system. We remain united in our commitment to root out health care fraud and support quality patient care.”
“Philip Esformes is a man driven by almost unbounded greed,” said Assistant Special Agent in Charge Denise M. Stemen of FBI Miami.
“The illicit road Esformes took to satisfy his greediness led to over $800 million in fraudulent health care claims, the largest amount ever charged by the Department of Justice.
“Along that road, Esformes cycled patients through his facilities in poor condition where they received inadequate or unnecessary treatment, then improperly billed Medicare and Medicaid.
“Taking his despicable conduct further, he bribed doctors and regulators to advance his criminal conduct and even bribed a college official in exchange for gaining admission for his son to that university. The FBI and its partners are constantly investigating health care fraudsters, big and small, who steal money from taxpayers at the expense of patients in need of quality medical care.”
“This largest ever healthcare fraud conviction highlights the awful toll criminal schemes take on federal health programs,” said Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office.
“Even beyond the vital dollars lost though, Esformes exploited and victimized patients by providing inadequate medical care and poor conditions in his nursing homes. Along with our law enforcement partners, we will continue the fight against such parasites.”
According to evidence presented at trial, from approximately January 1998 through July 2016, Esformes led an extensive health care fraud conspiracy involving a network of assisted living facilities and skilled nursing facilities that he owned.
Esformes bribed physicians to admit patients into his facilities, and then cycled the patients through his facilities, where they often failed to receive appropriate medical services, or received medically unnecessary services, which were then billed to Medicare and Medicaid, the evidence showed.
Several witnesses testified to the poor conditions in the facilities and the inadequate care patients received, which Esformes was able to conceal from authorities by bribing an employee of a Florida state regulator for advance notice of surprise inspections scheduled to take place at his facilities.
The evidence further showed that Esformes used his criminal proceeds to make a series of extravagant purchases, including luxury automobiles and a $360,000 watch.
Esformes also used criminal proceeds to bribe the basketball coach at the University of Pennsylvania in exchange for his assistance in gaining admission for his son into the university. Altogether, the evidence established that Esformes personally benefited from the fraud and received in excess of $37 million.
The Miami Herald reported that Esformes’ “defense team of high-priced lawyers also called a lineup of witnesses at trial, such as nurses, therapists and administrators who once worked for him. They testified about his hands-on management style, generosity of time and money, and devotion to his family and Jewish faith.”
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