Lawmakers focus on Medicare fraud by shell companies, nominee owners

Republican members of the Senate Finance and House Ways and Means committees last week sent a letter to Marilyn Tavenner, acting administrator of the Centers for Medicare & Medicaid Services (CMS), asking about efforts to prevent waste, fraud and abuse caused by “nominee owners” or “shell companies.” The lawmakers asked for information regarding efforts by CMS to identify nominee owners and the type of fraud perpetrated by individuals and organizations establishing paper-only firms with no real operations. They cited the March 7, 2012, indictment by the Department of Justice of an individual for allegedly swindling $20 million from the Medicare program over a five-year period by establishing two home health agencies using a nominee owner. “This indictment, along with the other examples cited in this letter, demonstrate … that CMS should revise its screening efforts to address nominee owners,” the letter said.