Health and Human Services Secretary Robert F. Kennedy Jr. said his department loses approximately $100 billion each year to fraud, describing several schemes that he said diverted taxpayer-funded healthcare dollars through fraudulent hospice operations and medical equipment companies.

Kennedy discussed the issue during a conversation with Detroit hip-hop artist Trick Trick, outlining what he described as widespread abuse of Medicaid reimbursement programs and recent enforcement actions taken by the Department of Health and Human Services.

“You know, my agency loses about $100 billion a year to theft, people stealing,” Kennedy said.

Trick Trick responded by asking, “HHS?”

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Kennedy replied by describing how investigators uncovered fraudulent hospice operations, particularly in the Los Angeles area.

“Typically, if you go to a hospice, you leave within 18 days because you're dying. It's terminal. Right. Right. We started looking at these hospices in Los Angeles, and the people never died. They were there, or two or three years later, they were there, and we're paying $6,000 a month,” Kennedy said.

According to Kennedy, investigators discovered that many of the listed hospice providers did not actually operate legitimate medical facilities.

“So those hospices, when we went and looked for them, they were yeah, we found a hotel room with 29 hospices in it. I mean, a hotel, every room was a hospice, and none of them had any patients. They were just addresses,” he said.

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Kennedy alleged that the individuals operating the businesses were using stolen patient information to bill Medicaid for services that were never provided.

“And the guys who owned them were, you know, they were Estonians and Armenians and people from Eastern Europe who were getting the patient numbers. They were stealing them from doctors' offices,” Kennedy said.

He also described another alleged method used to obtain patient information.

“They were also going into poor neighborhoods in Los Angeles, and they'd say to the people, ‘We'll give you this $375 flat screen TV. You give us your patient number, and we're going to enroll you in this hospice. You don't ever have to go. We're just going to enroll you, and then we'll charge Medicaid $6,000 a month forever, and the guy never dies, of course, because he he was never sick,’” Kennedy said.

Kennedy said similar fraud schemes were uncovered in South Florida involving durable medical equipment companies.

“Another way there was Cubans in Miami who were selling durable medical equipment. This is like wheelchairs, knee braces, you know, these kinds of things. They never had any durable medical equipment?” Kennedy said.

According to Kennedy, investigators again found businesses that existed only on paper.

“Again, we found hotels that every room in it was a durable medical equipment company. Like about a fifth of the durable medical equipment companies in the country were in South Florida, and none of them were selling durable medical equipment. But we were paying for it,” he said.

Kennedy said the department has taken action against those operations.

“But we were paying for it, and we're shutting down all that,” he said.

He added that HHS closed hundreds of hospice providers in Los Angeles without disrupting legitimate patient care.

“We shut down 800 hospices in Los Angeles, we didn't get a single call from a congressman or from a business owner saying, ‘Oh, you shut down my hospice, you know, and all these patients are on the street.’ None of them, because they were all crooked and they knew they were crooked,” Kennedy said.

Kennedy also said the department has targeted fraudulent activity involving autism-related services in Minnesota.

“So you know, and then we shut down Minnesota, all of the autism fraud in Minnesota, and those people were stealing money from kids who actually need it,” he said.

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