Canton Man Pleads Guilty in $4M Medicare DME Fraud Scheme
August 25, 2025 | JacobiJournal.com – A Canton man has pleaded guilty in a $4 million Medicare durable medical equipment (DME) fraud scheme involving medically unnecessary orthotic braces and deceptive telemarketing practices. The scheme is part of a broader federal crackdown under the $14.6 billion nationwide Healthcare Fraud Takedown. Federal prosecutors announced that a Massachusetts-based DME provider admitted to defrauding Medicare by billing for orthotic braces that were either not medically necessary or never provided to patients. The defendant, whose identity was released in court filings, used aggressive telemarketing tactics to obtain patient information and physician orders, often without proper medical evaluation. Between 2018 and 2022, the defendant submitted millions in false claims to Medicare for back, knee, wrist, and shoulder braces, resulting in more than $4 million in fraudulent reimbursements. How the DME Fraud Scheme Worked According to the Department of Justice, the Canton man paid overseas and domestic telemarketing companies to cold-call Medicare beneficiaries, offering free or low-cost medical equipment. Once the patient information was obtained, the scheme funneled bogus or forged prescriptions through complicit medical professionals. These orders were then billed to Medicare, even though many patients never received or needed the braces. The DME company also allegedly disguised kickbacks as “marketing fees” and “consulting payments” to conceal the fraud. Federal Crackdown and Takedown Operation This case is part of the U.S. Department of Justice’s 2025 National Healthcare Fraud Enforcement Action, which has resulted in criminal charges against over 200 individuals nationwide. The coordinated action targeted schemes involving telemedicine, DME fraud, pharmacy billing, and opioid distribution — with total intended losses exceeding $14.6 billion. DOJ Statement on the Guilty Plea “Healthcare fraud drains taxpayer dollars, endangers patients, and undermines trust in our medical system,” said Acting U.S. Attorney Joshua S. Levy for the District of Massachusetts. “This guilty plea sends a strong message to those exploiting Medicare: we will hold you accountable.” Sentencing for the defendant is scheduled for later this year. He faces up to 10 years in federal prison, restitution, and forfeiture of assets acquired through fraud. Workers, Patients & Providers: Know Your Rights Medicare beneficiaries are urged to report suspicious calls, billing statements, or unsolicited medical devices. Healthcare providers should maintain strict compliance programs and verify telehealth claims carefully. For full details on this case and other healthcare fraud enforcement actions, visit the U.S. Department of Justice – District of Massachusetts official press release section. FAQs: Canton Man Pleads Guilty Who is the Canton man that pleaded guilty in the Medicare DME fraud case? The man who pleaded guilty was the owner of a DME company that used telemarketing and false medical claims to bill Medicare for unneeded orthotic devices. What was the total amount involved in the DME fraud scheme? The man pleaded guilty to defrauding Medicare of over $4 million through false claims for unnecessary medical equipment. How does this DME fraud case connect to the nationwide healthcare fraud takedown? This DME fraud case is part of the broader $14.6 billion healthcare fraud takedown, which involved hundreds of defendants across the United States. What penalties could he face after pleading guilty? He could face up to 10 years in federal prison, restitution payments, and forfeiture of any assets obtained through the $4 million fraud. Stay ahead of fraud cases, legal updates, and compliance alerts. Subscribe to JacobiJournal.com today for trusted reporting on white-collar crime, healthcare enforcement, and regulatory actions. 🔎 Read More from JacobiJournal.com:
DOJ-HHS False Claims Act Working Group Intensifies Enforcement After $14.6B Takedown
August 11, 2025 | JacobiJournal.com – Following the historic $14.6 billion healthcare fraud takedown, federal agencies are doubling down on enforcement efforts under the reactivated False Claims Act Working Group, signaling an aggressive new era of oversight targeting fraudulent billing across the healthcare industry. The interagency team—led by the Department of Justice (DOJ) and the Department of Health and Human Services (HHS)—has not only revived the Working Group but is reportedly expanding its reach into newly flagged sectors, including behavioral health, teletherapy, and rural clinic billing models. New Investigations Already Underway According to DOJ insiders, a second wave of investigations is now underway, focusing on fraudulent claims involving telehealth services, durable medical equipment (DME), and unnecessary genetic testing. These schemes often prey on vulnerable populations and exploit regulatory gaps that emerged during the pandemic. While the initial healthcare fraud takedown charged 324 defendants—including medical professionals, clinic operators, and telehealth company executives—officials warn that this was just the “first phase” of a longer-term crackdown. “False Claims Act enforcement is now a frontline priority,” stated an official familiar with the task force. “We’re looking at everything from upcoded services to kickback arrangements involving marketing firms and call centers.” Enhanced FCA Enforcement Tools in Play Key to this effort is the strategic use of the False Claims Act (FCA), which allows the government—and whistleblowers—to bring civil actions against entities defrauding federal healthcare programs. By leveraging FCA provisions, the DOJ recovered more than $2.7 billion in healthcare fraud settlements in 2024 alone. As part of the intensified enforcement strategy, the DOJ-HHS Working Group is coordinating with: These collaborations are supported by enhanced data analytics tools that allow agents to identify anomalous billing patterns across Medicare, Medicaid, and TRICARE in near real-time. This integrated approach strengthens the government’s ability to execute large-scale healthcare fraud takedown operations, ensuring that fraudulent providers are identified and prosecuted efficiently. Industry Bracing for Fallout Legal analysts say the revived working group has put the industry on alert. “With this level of federal scrutiny, even compliant providers need to reassess their billing practices, referral relationships, and marketing vendors,” said a healthcare fraud defense attorney. “The government isn’t just targeting bad actors—they’re examining entire care delivery ecosystems.” In the wake of the takedown, several health systems and DME suppliers have launched internal audits, fearing that even minor regulatory violations could result in federal scrutiny or whistleblower claims. Compliance Tips for Providers Providers and healthcare businesses should take the following immediate actions to mitigate exposure: Experts caution that in today’s climate, ignorance of the law offers no defense. What’s Next? More arrests and settlements are expected in the coming months as the DOJ and HHS continue reviewing data and evidence collected during the healthcare fraud takedown operation. Industry stakeholders should anticipate ongoing False Claims Act enforcement waves well into 2026. For full case summaries and press releases, visit the DOJ’s official newsroom here. FAQs: DOJ False Claims Act Enforcement Update What is the False Claims Act Working Group? The DOJ-HHS False Claims Act Working Group is a task force dedicated to investigating and prosecuting healthcare fraud involving federal programs like Medicare and Medicaid. Why is FCA enforcement increasing now? Federal agencies are responding to widespread abuse of healthcare programs—especially telehealth and DME schemes—uncovered during the $14.6 billion fraud bust. The revived working group enables cross-agency coordination for faster and broader enforcement. How can healthcare providers avoid False Claims Act liability? Healthcare providers must ensure accurate billing, avoid illegal referral arrangements, and maintain documented compliance programs. Regular audits and staff training are essential. Subscribe to JacobiJournal.com to receive weekly enforcement updates, whistleblower case alerts, and FCA litigation insights tailored for legal, compliance, and health sector professionals. 🔎 Read More from JacobiJournal.com:
National Health Care Fraud Data Fusion Center Boosts DOJ-HHS Enforcement
July 25, 2025 | JacobiJournal.com – The National Health Care Fraud Data Fusion Center, jointly operated by the Department of Justice (DOJ) and Department of Health and Human Services (HHS), is rapidly transforming how federal authorities investigate and prosecute healthcare fraud. While first announced in late June, recent enforcement actions confirm the center’s pivotal role in accelerating the detection of fraudulent activity across Medicare, Medicaid, and telehealth platforms. How the Data Fusion Center Strengthens Fraud Enforcement The Data Fusion Center integrates real-time data analytics from multiple government agencies, enhancing the False Claims Act Working Group’s ability to identify anomalies, track financial flows, and connect disparate fraud schemes. This approach allows authorities to proactively flag high-risk providers and patterns before significant losses occur. The center’s work has already supported the 2025 National Health Care Fraud Takedown, which charged 324 defendants in schemes totaling $14.6 billion, including $1.17 billion in telehealth and genetic testing fraud. These figures represent the largest coordinated enforcement effort in healthcare fraud to date, demonstrating the fusion center’s growing impact. Impact on Telehealth Compliance and Analytics Telehealth providers, laboratories, and billing entities face heightened scrutiny as the fusion center applies advanced data analytics to monitor compliance. Organizations involved in telemedicine are particularly vulnerable, with the DOJ leveraging the center’s insights to trace billing irregularities linked to genetic testing scams and telehealth consults. This proactive enforcement model marks a shift from reactive investigations to continuous surveillance of healthcare transactions. As a result, companies in the healthcare sector are advised to strengthen their internal compliance protocols and regularly audit billing practices to avoid becoming targets of federal investigations. For more information on how healthcare fraud is tracked and prosecuted, visit the DOJ Health Care Fraud Unit resource page. What’s Next for the National Health Care Fraud Data Fusion Center Officials from both the DOJ and HHS suggest that the fusion center will continue to evolve, incorporating artificial intelligence and cross-border data sharing to combat increasingly sophisticated fraud schemes. Upcoming enforcement waves are expected to target providers exploiting risk adjustment models, prescription fraud, and unregulated telehealth services. With billions at stake, the center’s data-driven strategy is poised to redefine federal fraud enforcement, holding providers and corporations to higher standards of accountability. FAQ: National Health Care Fraud Data Fusion Center What is the National Health Care Fraud Data Fusion Center? The National Health Care Fraud Data Fusion Center is a joint initiative by the DOJ and HHS that uses real-time data analytics to detect and prevent healthcare fraud across Medicare, Medicaid, and telehealth services. How does the fusion center impact telehealth providers? Telehealth providers are under increased scrutiny as the fusion center analyzes billing data to identify fraudulent or non-compliant practices, especially in genetic testing and telehealth consultations. What were the results of the 2025 healthcare fraud takedown? The 2025 enforcement action charged 324 defendants with healthcare fraud schemes totaling $14.6 billion, with a significant portion linked to telehealth and genetic testing scams. Which schemes were uncovered by the fusion center? Authorities identified transnational networks billings exceeding $10.6 billion in DME fraud (Operation Gold Rush), telehealth/genetic testing fraud, opioid-related kickbacks, and false hospice claims. Where can I report suspected healthcare fraud? Reports of healthcare fraud can be submitted to the HHS Office of Inspector General (OIG). Stay informed on healthcare fraud enforcement and telehealth compliance developments. Subscribe to JacobiJournal.com for the latest insights on regulatory actions and industry risks. 🔎 Read More from JacobiJournal.com:
Second Round of Guilty Pleas in California $16M Hospice Billing Scheme
July 11, 2025 | JacobiJournal.com – $16M hospice fraud led to guilty pleas from two California residents in a widening Medicare scam, federal prosecutors announced. The scheme involved fraudulent billing for hospice services and laundering millions through shell companies, reflecting the DOJ’s continued focus on prosecuting healthcare crime at all level How the Fraud Worked According to court filings, the defendants conspired to submit false claims to Medicare for hospice services that were either medically unnecessary or never delivered. Patient information was manipulated, and documentation was falsified to create the appearance of legitimate end-of-life care. In reality, many of the patients did not qualify for hospice, and some were unaware they had been enrolled at all. This conduct was a key element of the $16M hospice fraud scheme now under federal prosecution. By exploiting gaps in Medicare’s hospice eligibility verification process, the conspirators were able to generate millions in unlawful reimbursements. The $16M hospice fraud case also highlights how vulnerable patient records can be misused, particularly when oversight mechanisms fail. Authorities have emphasized that such manipulation not only defrauds the system but may impact patient care by interfering with their medical histories and future eligibility for benefits. Larger Investigation Unfolds These pleas are part of a wider investigation involving multiple co-defendants across California and other states. The Department of Justice confirmed that the defendants also took part in laundering the proceeds through shell companies and fraudulent financial transactions. Federal prosecutors emphasized that each guilty plea strengthens their case against the broader network behind the scam. Authorities are continuing efforts to recover misused funds and pursue remaining individuals tied to the fraud. The $16M hospice fraud scheme has drawn national attention due to its scale and coordination. Investigators are now analyzing financial records, communications, and business filings to trace the full extent of the operation. Law enforcement sources suggest the fraudulent activity may have extended over several years and involved actors in the healthcare, finance, and legal sectors. With more defendants likely to be charged, the DOJ has framed the case as a critical example of its broader initiative to root out large-scale healthcare fraud that endangers patients and drains federal resources. A Signal to the Industry The case underscores how financial crime within healthcare continues to evolve—and how regulators are sharpening their focus on compliance enforcement. With sentencing pending, both defendants face potential prison time and restitution orders. Federal agencies say more charges are possible as the investigation unfolds. The $16M hospice fraud case serves as a stark reminder to providers and organizations operating in the healthcare sector that federal oversight is intensifying. As digital records, billing platforms, and reimbursement systems become more sophisticated, so do attempts to exploit them. This prosecution demonstrates that law enforcement agencies are prepared to dismantle entire networks, not just penalize individuals, when fraud is detected. For professionals working in compliance, billing, and provider administration, the case highlights the importance of strong internal auditing, ethical oversight, and transparent documentation. As the healthcare industry continues to shift toward value-based and end-of-life care models, the government is making clear that any abuse of these systems will be met with aggressive legal action. To read more information about this case, visit Justice.gov. FAQs: About the $16M Hospice Fraud Guilty Pleas What were the defendants accused of in the $16 million hospice fraud scheme? The defendants admitted to submitting false claims to Medicare for hospice services that were either medically unnecessary or never provided. They also engaged in money laundering to conceal the proceeds of the fraud. How did the fraud scheme exploit Medicare and patients? The scheme used falsified documentation and enrolled patients—many of whom did not qualify for hospice—without proper medical justification. Some patients were unaware they were listed as receiving end-of-life care, which could affect their future access to legitimate medical services. What are the potential penalties for those who plead guilty? Each defendant faces a potential federal prison sentence, restitution orders, and fines. Sentencing decisions will be made by a federal judge at a later date, based on the severity of the charges and the financial impact on Medicare. Why is the $16M hospice fraud case significant to Medicare oversight? This case exposes vulnerabilities in Medicare’s hospice billing system and underscores the importance of regulatory oversight. The Department of Justice is using this $16M hospice fraud as an example to signal stronger enforcement and deter future abuse of federal healthcare programs. Get the latest updates on healthcare fraud, regulatory enforcement, and Medicare oversight. Subscribe to JacobiJournal.com for in-depth reporting delivered directly to your inbox. 🔎 Read More from JacobiJournal.com:
OJ Indicts 49 in $1.17 Billion Telehealth Genetic Testing Fraud
July 2, 2025 | JacobiJournal.com – The Department of Justice (DOJ) has announced the indictment of 49 individuals connected to a massive telehealth genetic testing fraud scheme that defrauded Medicare of approximately $1.17 billion. This national enforcement action marks one of the most significant takedowns targeting the intersection of telemedicine and genetic testing abuse. National Crackdown on Telemedicine Scams Federal prosecutors revealed that defendants operated fraudulent telehealth consultations to justify unnecessary genetic testing and medical equipment. These fake medical services led to thousands of false Medicare claims for tests that patients did not need, did not request, or never received. Investigators discovered that telemedicine companies collaborated with laboratories and marketing firms to orchestrate the scam, exploiting both patients and Medicare’s billing systems. The DOJ emphasized that while telehealth offers legitimate benefits, fraudsters have weaponized the convenience of virtual care to conceal large-scale fraud. Financial and Ethical Impact of Telehealth Genetic Testing Fraud Authorities stated that this scheme drained over a billion dollars from Medicare, ultimately burdening taxpayers and undermining trust in remote healthcare services. Fraudulent genetic testing not only results in financial losses but also exposes patients to unnecessary medical procedures and the risk of compromised personal health data. DOJ Reinforces Commitment to Healthcare Integrity The DOJ reiterated its commitment to pursuing healthcare fraud aggressively, especially as telemedicine remains a growing field. Officials encouraged healthcare providers to strengthen compliance efforts and urged the public to remain vigilant against suspicious medical services. For additional information on how to recognize and report Medicare fraud, visit the Centers for Medicare & Medicaid Services (CMS) official resource page. What’s Next for Enforcement The DOJ hinted that further investigations are underway, with more arrests expected in related telehealth and genetic testing schemes. Federal prosecutors have emphasized that this is only the beginning of a larger nationwide effort to dismantle complex fraud networks exploiting Medicare through telemedicine. As telehealth genetic testing fraud continues to evolve, authorities are enhancing interagency collaboration between the DOJ, FBI, and the Department of Health and Human Services to track and intercept these fraudulent operations. Additionally, the DOJ plans to leverage advanced data analytics and whistleblower tips to identify hidden connections between healthcare providers, laboratories, and telehealth platforms that may be facilitating or concealing fraud. This July enforcement wave reflects a broader strategy to safeguard public healthcare funds, strengthen Medicare integrity, and restore confidence in digital health services by ensuring that telehealth remains a legitimate and safe avenue for patient care. FAQ: Understanding Telehealth Genetic Testing Fraud What is telehealth genetic testing fraud? Telehealth genetic testing fraud involves scammers using virtual healthcare platforms to order unnecessary or fake genetic tests. Fraudsters often collaborate with labs and marketing firms to bill Medicare for services that were never needed or provided. How can patients avoid falling victim to telehealth genetic testing fraud? Patients should consult their primary care physician before agreeing to any genetic tests offered through telehealth. They should also verify that the provider is legitimate and be cautious of unsolicited offers for medical testing. How do authorities detect and investigate telehealth genetic testing fraud? Authorities like the DOJ and CMS use data analytics to identify abnormal billing patterns and networks of providers submitting excessive claims for genetic testing. Investigations often trace financial transactions to uncover fraudulent schemes. Where can I report suspected telehealth genetic testing fraud? You can report suspected telehealth genetic testing fraud directly to Medicare here or contact the Office of Inspector General (OIG) fraud hotline. Stay informed on telehealth genetic testing fraud cases and healthcare enforcement actions. Subscribe to JacobiJournal.com for weekly updates on fraud prosecutions, regulatory crackdowns, and compliance news. 🔎 Read More from JacobiJournal.com:
Genetic Testing Scams: The New Face of Medicare Fraud
June 18, 2025 | JacobiJournal.com – Genetic testing scams are quickly becoming a major form of Medicare fraud, targeting seniors with misleading offers and unauthorized billing schemes. These scams usually begin with a cold call, a booth at a senior center, or even a misleading TV ad claiming to offer free DNA testing for cancer or other conditions. Once a patient provides their Medicare number, scammers bill the government for unnecessary or completely fake tests—costing taxpayers millions. Although these scams promise insight into personal health, they rarely provide any medical value. Instead, the goal is to exploit Medicare’s coverage of genetic testing. A Growing Threat to Seniors and Taxpayers The appeal of genetic insights makes this scam effective, particularly among vulnerable senior populations who are more likely to trust medical professionals or health-related offers. Fraudsters often employ aggressive marketing tactics and fake affiliations with Medicare or healthcare providers to establish trust and gain access to sensitive private information. Furthermore, these schemes often involve third-party labs and marketers who split profits from fraudulent claims, making detection even more challenging. This multi-layered setup allows scam operations to avoid early scrutiny while maximizing profit. Protecting the Public and Medicare Government agencies, including the Office of Inspector General and CMS, have issued warnings and are actively investigating such schemes. Still, public awareness is key. Patients should never share Medicare information with unfamiliar sources or agree to free tests without consulting their doctor. Ultimately, understanding how genetic testing scams work is the first step in stopping them. Clear regulations, routine audits, and public education will be crucial in protecting both patient trust and public funds. For more official information on Medicare-related scams, visit the Office of Inspector General (OIG) fraud alerts. FAQs: About Genetic Testing Scams How do genetic testing scams target Medicare patients? Genetic testing scams often begin with unsolicited calls, senior center booths, or deceptive ads offering free DNA tests. Scammers collect Medicare numbers to bill for unnecessary or fake tests, exploiting both seniors and the Medicare system. What risks do seniors face from genetic testing scams? Victims of genetic testing scams risk identity theft, compromised medical data, and contributing to Medicare fraud unknowingly. These scams often leave patients without any valuable health insights despite claims. How can Medicare beneficiaries avoid genetic testing scams? To avoid genetic testing scams, seniors should only undergo genetic testing recommended by their personal doctor. Medicare numbers should never be shared with unsolicited callers, marketers, or unfamiliar medical providers. Stay protected against healthcare fraud. Subscribe to JacobiJournal.com for ongoing updates on Medicare scams, fraud enforcement, and patient safety insights. 🔎 Read More from JacobiJournal.com:
Telemedicine and Fraud: A Double-Edged Sword
June 11, 2025 | JacobiJournal.com – Telemedicine fraud is rising alongside the boom in virtual healthcare. As telemedicine reshapes healthcare access, it also opens new opportunities for deception. While virtual care brings convenience, bad actors exploit its digital nature to commit large-scale schemes. From fake billing to identity theft, the risks are mounting — and healthcare professionals must stay vigilant. The Rise of Telemedicine Fraud and Virtual Care Challenges Telemedicine surged during the pandemic, making healthcare more accessible for millions. However, this rapid adoption also left gaps that fraudsters eagerly filled, fueling a surge in telemedicine fraud. Scammers have exploited the virtual nature of care, taking advantage of lax verification processes and limited oversight in remote consultations. They used stolen identities, fake provider credentials, and inflated claims to siphon funds from government programs like Medicare and Medicaid. In many cases, telemedicine fraud involves billing for services never provided, fabricating patient encounters, or exaggerating the complexity of care delivered. This fraudulent activity not only drains public resources but also undermines trust in digital health services, creating barriers for legitimate telehealth providers and patients seeking convenient care options. Red Flags in Remote Care Fraudsters have grown more sophisticated. Some create fictitious clinics that never see patients but still bill for services. Others submit claims for expensive tests or procedures that never occurred. Additionally, providers have reported instances where patients were billed for telehealth visits they never scheduled. Enforcement Agencies Step In Thankfully, government watchdogs have significantly increased enforcement efforts to combat telemedicine fraud. Agencies like the Department of Justice (DOJ), the Office of Inspector General (OIG), and the Centers for Medicare & Medicaid Services (CMS) are working together to investigate and prosecute telehealth-related fraud schemes more aggressively. Recent enforcement actions include coordinated nationwide takedowns targeting fraudulent telemedicine providers who exploited Medicare and Medicaid. These operations often uncover complex networks involving fake clinics, unlicensed practitioners, and fraudulent billing practices. Despite these efforts, many telemedicine fraud schemes remain undetected due to the digital and often anonymous nature of virtual healthcare, costing taxpayers billions annually. Regulators are also investing in advanced data analytics and cross-agency collaborations to better identify suspicious patterns in telehealth billing. This enhanced scrutiny aims not only to catch current offenders but also to deter future fraud in the rapidly growing virtual healthcare sector. What Healthcare Organizations Can Do To stay ahead of fraud, healthcare organizations must implement robust compliance programs. Regular audits, identity verification, and secure digital platforms help reduce the risk. Moreover, training staff to recognize unusual billing or patient activity strengthens the first line of defense. A Call for Balanced Innovation Ultimately, telemedicine offers undeniable benefits—but it must evolve with fraud prevention in mind. As the industry grows, so must the systems that protect it. With proper safeguards, healthcare providers can embrace innovation while keeping fraud at bay. Learn more about healthcare fraud prevention from the HHS Office of Inspector General here. FAQ: Understanding Telemedicine Fraud What is telemedicine fraud and how can patients protect themselves?Telemedicine fraud occurs when scammers exploit virtual healthcare services to submit false claims, use stolen identities, or bill for services never provided. Patients can protect themselves by verifying their telehealth provider’s credentials, keeping track of services received, and monitoring their insurance statements for unauthorized charges. Reporting suspicious activity to healthcare authorities can also help prevent further fraud. Stay informed on telemedicine fraud trends and healthcare enforcement updates. Subscribe to JacobiJournal.com for weekly insights into fraud prevention and regulatory news. 🔎 Read More from JacobiJournal.com:
Asbestos Clinic Closure Ordered to Pay BNSF Jury Award
May 16, 2025 | JacobiJournal.com – The asbestos clinic closure in Libby, Montana, has sparked renewed concern over public health and corporate accountability. Authorities shut down the Center for Asbestos Related Disease (CARD) this week to enforce a $3.1 million debt owed to BNSF Railway, following a controversial fraud judgment. The abrupt asbestos clinic closure leaves thousands of residents—many exposed for decades to toxic vermiculite dust—without critical respiratory care and disease monitoring. As the only local facility specializing in asbestos-related illnesses, CARD’s shutdown raises questions about healthcare access and the lasting consequences of environmental disasters. Asbestos Clinic Closure Sparks Public Health Concerns On Wednesday, the Lincoln County Sheriff’s Office seized and shut down the Center for Asbestos Related Disease (CARD). Located in a town of just 3,000 people, the clinic has operated for over two decades near a now-defunct vermiculite mine that emitted toxic asbestos dust. Thousands of residents have suffered health consequences, and CARD had become a cornerstone of their medical care. Despite its long-standing role in treating asbestos-related illnesses, the clinic now faces closure because of a $6 million fraud judgment awarded in 2023 to BNSF Railway. After legal fees and interest, BNSF claims it is owed $3.1 million. Allegations of Fraud and Fallout from Court Case The legal dispute began when BNSF, a Texas-based railway, sued CARD under the False Claims Act. The suit alleged that the clinic fraudulently diagnosed patients with asbestos-related illnesses to qualify them for federal Medicare benefits. According to court findings, 337 out of over 2,000 diagnoses were ruled invalid. BNSF transported contaminated material through Libby for decades, and it continues to face lawsuits from local victims of asbestos exposure. Nonetheless, the company prevailed in this case by claiming that CARD manipulated patient data, thereby defrauding the government. As a whistleblower under federal law, BNSF was entitled to a portion of the government’s recovery from the judgment. BNSF spokesperson Kendall Kirkham Sloan defended the closure, stating: “The judge determined the amount of damages to be repaid, and the process for recovery is set by law.” Bankruptcy Complicates the Enforcement However, the situation is far from resolved. After the judgment, CARD filed for bankruptcy and reached a court-approved settlement with the federal government, which included BNSF. According to James “Andy” Patten, the clinic’s bankruptcy attorney, the railway’s recent actions violated that agreement. “This seizure undermines a settlement that was approved by a federal court,” Patten argued. When asked about the bankruptcy terms, Sloan declined to comment. Community Faces Growing Health Risks Tracy McNew, Executive Director of CARD, expressed deep concern for the community. “CARD remains committed to its patients and the Libby community and will fight to reopen as soon as possible,” she stated. Until the closure, CARD served as the only local medical facility offering asbestos-related health screenings, monitoring, and treatment. Many in Libby fear that without this specialized care, health conditions will go undiagnosed and untreated—especially among the town’s aging population, which faces elevated risks from long-term asbestos exposure. The asbestos clinic closure not only disrupts continuity of care but also eliminates access to early detection services crucial for those exposed decades ago. Experts warn that mesothelioma, asbestosis, and other related conditions can develop silently for years, making regular checkups essential for early intervention. Public health advocates and residents alike argue that the sudden loss of CARD’s services creates a healthcare vacuum that federal or state resources have yet to fill. In the wake of the asbestos clinic closure, several community groups are calling on lawmakers to intervene and provide emergency medical access for affected residents. The situation highlights broader concerns over how legal judgments can impact essential healthcare infrastructure in underserved, contaminated communities. Learn how the BNSF case leveraged federal law—explore the U.S. Department of Justice’s official overview of the False Claims Act at justice.gov. FAQs: About the Asbestos Clinic Closure and Its Impact How is the asbestos clinic closure affecting long-term patient care in Libby? The asbestos clinic closure has disrupted access to specialized screenings and treatment, putting long-term patients at risk of undiagnosed or worsening conditions. Subscribe to JacobiJournal.com for trusted updates on asbestos litigation, federal fraud rulings, and public health enforcement actions, such as the CARD clinic closure, which impacts vulnerable communities. 🔎 Read More from JacobiJournal.com: