• Angel Castillo Jr., a high school dropout and convicted drug dealer, acquired 11 medical equipment companies in the mid-2000s. He used Cuban migrants as straw owners for three of those businesses to disguise his ownership role. Castillo, convicted of billing $48 million in false Medicare claims and pocketing $8 million, had his 20-year prison sentence slashed in half for helping authorities prosecute a dozen defendants.
Medicare officials said the program regularly conducts criminal background checks on healthcare operators and has disqualified some felons as a result — but it has missed those who put the businesses in other people’s names with clean records.
Last year, Medicare adopted new measures designed to combat the failed “pay and chase” model of doling out dollars for claims, then pursuing the scammers after they have run off with the money. As part of the Affordable Care Act, Medicare received $350 million to develop stricter screening of healthcare providers and more sophisticated software for detecting fraudulent claims.
Among the improvements: providers who historically have posed a higher risk of fraud, such as medical equipment suppliers and home care service suppliers, must now undergo more comprehensive screenings, including FBI criminal background checks and fingerprinting.
Also, if Medicare billing contractors receive a “credible” allegation of fraud from a patient, payments to a provider can temporarily be suspended while an investigation is done.
The upgrades in screening and technology came in response to massive taxpayer losses in South Florida — regarded as the nation’s healthcare fraud capital — and other parts of the country.
“Medicare is hemorrhaging money because of cases like this,” said Bernstein, the prosecutor, referring to the Sanzes. He told the judge that the couple, whose young daughter is living with her grandmother, blew all of their Medicare millions: “The money is gone.”