On the streets with Dr Oz as surprise fraud crackdown sends daycare directors scrambling
FLUSHING, N.Y. — Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz confronted employees at two New York City senior care centers over suspected Medicaid fraud, challenging their billing practices as Fox News Digital got an exclusive look at the crackdown in action.
Oz, accompanied by senior federal health officials, delivered warning letters to Kent Senior Care and Evergreen Adult Day Care in Flushing, Queens, during a broader fraud crackdown that involved the FBI, the Department of Health and Human Services Office of Inspector General, the NYPD and other agencies.
The letters notified the facilities that their billing practices had raised concerns among federal authorities. The two visits by Oz were part of a broader crackdown in which CMS officials conducted more than 80 visits and delivered warning letters to providers across New York City on Tuesday.
Fox News Digital accompanied Oz as he pressed employees about questionable billing records and challenged their explanations for how taxpayer dollars were being spent.
DR. OZ NAMES 5 STATES IN FRAUD CRACKDOWN AS TRUMP ADMIN TARGETS MEDICAID ABUSE
"The whole experience was suspicious," Oz told Fox News Digital in an exclusive interview following the visits.
Oz said federal authorities were conducting a broader crackdown that included arrests, search warrants and efforts to stop certain operators from billing Medicaid, although Fox News Digital did not independently witness those enforcement actions at either Queens facility.
Kent Senior Care declined comment during a phone call with Fox News Digital on Tuesday. Evergreen Adult Day Care did not immediately respond to Fox News Digital's request for comment.
The first stop came around 8:30 a.m. at Kent Senior Care, where Oz entered the facility and personally handed its director a letter from the federal government notifying the business that its billing practices were under scrutiny.
"The bills are much higher than they should be," Oz told the director. "The billing is for more people. It doesn't look very crowded here."
The director pushed back during the exchange, explaining that it was still early and additional seniors would arrive later in the morning, as Oz questioned whether the facility's Medicaid billing records accurately reflected its actual attendance.
The occupancy of the space was 70 persons, according to an observe posted maximum occupancy sign on the wall.
"The bills we're getting are as though it's completely full all the time," Oz said.
FBI ADDS 2 FUGITIVES TO 'MOST WANTED FRAUDSTERS' LIST AMID HISTORIC $6.5B HEALTHCARE TAKEDOWN: PATEL
The director maintained that the facility billed only for seniors who actually attended, and that it required participants to sign attendance sheets.
"You're getting this letter from the U.S. Government because we don't believe you," he told the director.
During the exchange, Oz also questioned why the center's billing records appeared to reflect seniors attending five days a week when the director acknowledged that many participants typically attended only two or three days.
The director insisted the facility billed for actual attendance and said some seniors attended more frequently than others.
The confrontation intensified when Oz and other federal officials raised questions about specialized transportation services billed for seniors using wheelchairs.
DR OZ SAYS 800 HOSPICE PROVIDERS SUSPENDED IN CALIFORNIA OVER ALLEGED $1B MEDICARE FRAUD SCHEME
"I don't see any wheelchairs here," Oz told the director.
Fox News Digital observed seniors inside the facility, including individuals using walking aids, but did not see anyone using a wheelchair during the visit.
Another official said billing records included charges for specialized wheelchair transportation, raising questions about whether the services had been provided and which company was responsible for submitting the charges.
The director said some seniors had mobility difficulties, including those recovering from strokes, and that the facility had wheelchairs available. He also said that workers could have copied information from previous files instead of properly updating the billing codes as it applied to wheelchair use.
"Probably he just copy and pasted," the director said.
During the visit, Oz walked over to several mahjong tables set up inside the facility, questioning whether taxpayer dollars were being properly spent on the recreational activities offered through the Medicaid-funded program.
"Should the American taxpayers be paying so folks can play mahjong?" Oz asked the director.
The director defended the activity, explaining that mahjong helps seniors exercise their fingers, socialize and improve their memory, particularly those experiencing cognitive difficulties.
"It's free for them, not free for the taxpayers," Oz responded. "Is that what our federal tax dollars for Medicaid is supposed to go to? Or is it life-saving heart surgery? Or, you know, new therapies for cancer?"
Oz raised additional concerns about the facility's attendance records after observing seniors entering without signing in, despite the director's insistence that participants were required to document their attendance.
"People were just walking in there without signing anything," Oz said. "And then after I showed up and he saw what we were doing with my team, he started collecting these documents to be signed."
Oz said the apparent inconsistencies raised further questions about whether the facility's attendance records accurately reflected the services being billed to Medicaid.
Fox News Digital also witnessed several seniors enter Kent Senior Care without immediately signing attendance sheets. Additional seniors who arrived later were instructed to sign in.
Social adult day care programs can provide eligible seniors with structured activities, supervision, meals and social support. Medicaid reimbursement depends on applicable program rules, individual eligibility and documentation of services provided.
At the second stop, Evergreen Adult Day Care, Oz confronted a floor manager over another set of billing discrepancies before examining the facility's attendance records.
The manager told Oz that approximately 200 seniors attended the facility on Mondays, Wednesdays and Fridays, compared with about 150 on Tuesdays and Thursdays, although it was unclear whether those figures represented total daily attendance or the number of seniors present at one time.
But Oz questioned those numbers after walking through the facility and observing significantly fewer people.
"So I look at maybe 25 people in the whole space now," Oz said.
The manager disputed that estimate, explaining that some seniors were participating in classes while others had left to shop, visit a pharmacy or attend medical appointments.
"The numbers don't seem to add up," Oz responded.
Oz also questioned the manager about wheelchair-related billing, asking how many participants used wheelchairs.
TRUMP'S WAR ON FRAUD EXPANDS AS TREASURY LAUNCHES NEW SITE WITH WHISTLEBLOWER INCENTIVES
The manager initially indicated that none did before acknowledging that a small number of seniors used them.
"But you said there weren't any, were you?" Oz pressed.
He subsequently discussed the apparent discrepancy with other federal officials accompanying him.
"I'm struck by how few people are here as well," Oz said. "This makes me wonder how they sustain these billing levels."
The visit took another turn when Oz examined the facility's attendance books, which he said contained "fraud."
Fox News Digital observed sign-in sheets that appeared to contain names entered for Oct. 22, and Oct. 23, dates that had not yet occurred at the time of the visit.
The entries dated Oct. 22 and Oct. 23, both after the visit, raised questions about whether the facility was documenting attendance in advance, although Fox News Digital could not immediately establish whether the entries were completed attendance records or advance schedules.
Oz said federal authorities believed organized criminal networks were exploiting the Medicaid-funded programs by offering seniors money to attend facilities and then billing the government for services that were not actually provided.
Oz alleged that individuals he described as being connected to the "Chinese mafia" were paying some seniors between $1,000 and $1,200 to participate in fraudulent billing arrangements, though the administrator did not identify a specific criminal organization or provide supporting evidence during the interview.
Oz said the federal government had identified significant spikes in billing across the industry and claimed that annual spending on the programs had approached $1 billion.
"We know from the billing here that there's no way this business is running in the way that they claim to be running without something being wrong," Oz told Fox News Digital.
"Is it an innocent mistake? A hundred times in a row, I don't think so."
Oz alleged that proceeds from fraudulent Medicaid billing schemes were being used to finance other criminal activities, including money laundering and human trafficking, although Fox News Digital had not independently verified those connections or established any such link to the two facilities visited.
"It's really a clubhouse for crime," Oz said while describing the alleged broader scheme.
He said fraud accelerated during the COVID-19 pandemic and criticized the previous administration for failing to address what he described as rapidly rising spending and suspicious billing.
New York Gov. Kathy Hochul acknowledged the crackdown on Tuesday, calling it part of a "massive effort to combat fraud and abuse" in Medicaid and confirming that state health officials had joined federal and state law enforcement in targeting suspected fraud at social adult day care programs.
While Oz personally delivered warning letters to the two Queens facilities, state, local and federal law enforcement officials were simultaneously conducting searches at other locations across New York City as part of the coordinated crackdown.
Specific details about the facilities targeted, individuals involved and evidence recovered were not immediately available as the investigations remained ongoing.