Since 2006, U.S. taxpayers have paid nearly $155,000 to send home health nurses to inject twice-daily insulin shots for an elderly, diabetic Miami man.

But in fact, the man was not diabetic or homebound and the nurses never existed, according to a federal indictment. Now the owners of two Miami companies that purportedly cared for the man are charged with running a $22 million fraud scheme at the expense of Medicare, the federal health program for the elderly and disabled.

Medicare billing records showed the man, identified in court documents as M.G., had rarely ordered any insulin or syringes. When his care switched from one home care company to another, he had no injections for 30 days -- miraculously cured of his alleged insulin-dependence for a month, U.S. prosecutors joked in court papers.

As the Obama administration pursues an overhaul of the U.S. health care system and proposes expanding government's role, it also has expanded efforts to root out the fraud that is bleeding tens of billions of dollars a year from Medicare.

The gigantic federal program provides health care for 45 million people who are over 65, blind or disabled and has a proposed budget of $453 billion next year.

In June, the Justice Department and Department of Health and Human Services created Medicare anti-fraud strike forces in Detroit and Houston. Like one set up in Los Angeles last year, they are modeled after one born in Miami, the nation's Medicare fraud capital.


In a state with a huge retiree population, Miami is especially rife with Medicare scams because it has pools of non-English-speaking elderly residents who often do not understand the billing practices, federal prosecutors said. It also is a diverse urban area where patients do not necessarily know their doctors and nurses or even their neighbors.

Miami is a place where anyone from anyplace in the world can blend in, said Jeffrey Sloman, acting U.S. attorney for southern Florida.

Miami has seven teams of prosecutors, FBI agents and federal auditors looking very hard for Medicare scams. Since the precursor to that strike force was set up in 2005, more than 700 people have been charged with fraudulently billing Medicare more than $2 billion in the Miami area, and $350 million has been recouped, Sloman said.

As the new anti-fraud forces ramp up, I think those other parts of the country are going to discover that they also have a significant Medicare fraud problem, he said.

Increasingly, federal agents and the companies that process Medicare claims are cross-referencing bills and using data mining to try to find suspicious patterns.

They focused on the diabetic injection scam after finding Medicare spending for home health care in the Miami area had jumped tenfold in a couple of years, though there had been no surge in the elderly population or prevalence of diabetes.

Another audit showed three south Florida counties accounted for 72 percent of Medicare charges nationwide for HIV/AIDS beneficiaries, although only 8 percent of such patients lived there. Most of the money went to intravenous drug therapy.


That led to an investigation that saw eight people indicted in June on charges of fraudulently billing Medicare $100 million for purported intravenous therapies at clinics that existed only as empty storefronts or post office boxes.

With the supposed diabetics, prosecutors said patients were bribed to let the defendants use their names on false claims.

Increasingly, the patients and doctors whose names are on the bills know nothing of the fraud, investigators said. Scammers steal identities with the help of unscrupulous clinic or billing workers or buy lists on the Internet. They often use the numbers long after the patients die.

One bogus clinic ran help-wanted ads for doctors, then stole their Medicare provider numbers off the job applications, said Eric Bustillo, chief of U.S. attorney's economic and environmental crimes section.

Often, there's no health care involved at all. It's pure billing fraud and Medicare is vulnerable in part because by law it must pay claims quickly, usually within 30 days. Investigators call it a pay and chase system.

By the time you figure out that it's a fraudulent claim the money's already been paid, Bustillo said.

Since patients' Medicare ID numbers are based on Social Security numbers, it is difficult to change them once they've been compromised, and scammers keep using them.

Investigators say Medicare could learn from credit card companies, which are good at quickly spotting unusual charges.

Policy changes and safeguards to the Medicare program will go a lot further in saving health care fraud dollars than will prosecutions after the fraud has been committed, Sloman said. By the time a case gets to us, the money is already gone.