Prosecutors Face Setback in Massive Assisted Living Fraud Case

A judge has dealt a significant blow to federal prosecutors in the nation’s largest Medicare fraud case to date.

Magistrate Judge Alicia Otazo-Reyes threw out crucial evidence in a $1 billion fraud indictment against Philip Esformes, a health care executive behind more than 30 Miami-area skilled nursing and assisted living communities, reported the Miami Herald.

The judge said in a 117-page ruling that a 2016 search of the Eden Gardens assisted living community by prosecutors with the U.S. Justice Department and FBI agents amounted to “misconduct.” While Otazo-Reyes didn’t dismiss the indictment outright, she did choose to suppress certain protected correspondence and evidence that she ruled was improperly obtained.


While the latest ruling doesn’t mean Esformes is off the hook before his trial in January, it could prove to be a major thorn in the side of prosecutors while giving the defense team more leverage, the Miami Herald further reported.

Esformes is charged with conspiracy, obstruction, money laundering and health care fraud in connection with a $1 billion scheme involving numerous Miami-based health care providers, according to the Department of Justice. Esformes, along with two co-conspirators, allegedly admitted Medicare and Medicaid patients to a number of retirement facilities, where they received medically unnecessary services that were billed to the federal payers.

Furthermore, the three people in the criminal scheme also received kickbacks for sending the beneficiaries to other health care providers, who also allegedly performed services that were medically unnecessary, authorities said.


If convicted, Esformes could spend the rest of his life in prison.

Written by Tim Regan

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