A new elaborate Medicare scam is targeting seniors nationwide. One of its most recent victims was an 86-year-old woman from Utah, who spoke to reporters on condition of anonymity.
The woman, who lives in a rural area, was persuaded by two young people who knocked on her door to hand over her Medicare number, her SSN, and even a sample of her DNA. The object of the fraudsters was to bill Medicare for DNA tests covered by the government program.
Older Medicare beneficiaries all over the country have told similar stories. The fraudsters target them using different methods, including social media ads, cold calls, email, and even Craigslist posts.
On July 19, the Federal Trade Commission (“FTC”) issued a warning against “creative scammers,” stating that, “callers claiming to be from Medicare are asking people for their Medicare numbers, Social Security numbers, and other personal information…in exchange for DNA testing kits. The callers might say the test is a free way to get early diagnoses for diseases like cancer, or just that it’s a free test, so why not take it? But the truth is, Medicare does not market DNA testing kits to the general public. . . scammers may give what seems like a believable explanation for needing your information.”
The FTC advised Medicare beneficiaries to refrain from giving anyone their personal information or allowing them to swab their cheeks to obtain DNA samples.
The stories shared by victims have allowed the government to piece together some of the fraudsters’ tactics, which include recruiting Medicare beneficiaries from low-income homes and senior centers, and offering them gift cards, pizza, or ice cream in exchange for information and DNA samples.
The victim from Utah said she regretted having allowed the two strangers to swab their cheek, and recalled telling herself at night, “You fool, you shouldn’t have done that.” Like her, many victims who have spoken to reporters and investigators have said they felt betrayed and confused.
Medicare Part B covers certain DNA tests (CGx and PGx). They are used to detect specific vulnerabilities, such as high cancer risks or medication side effects. Though the victims are not asked to pay for the tests, the government program ends up paying handsomely for them, from $6,000 to as much as $25,000 per test. Thus, all taxpayers indirectly become the fraudsters’ victims.
Recent court cases have revealed that the individuals who knock on vulnerable seniors’ doors are not acting alone. There are doctors receiving kickbacks to order the DNA tests for patients they have never seen, and labs are often also part of the scheme. Millennium Health and Companion DX Reference Lab are two of the labs that have already been prosecuted in connection with recent cases.
In order to persuade seniors, fraudsters often use scare tactics, telling them they might be at risk of stroke or cancer unless they agree to take the lucrative DNA tests. In New Jersey, three people have already been sent to prison for persuading hundreds of aging Medicare beneficiaries to provide samples and information that allowed them to collect $100,000 in commissions from the labs doing the tests.
Assistant U.S. Attorney Bernard Cooney referred to the new type of fraud as a “gold rush” that is “leading to a big response by the government.” In California, for example, one out of every four fraud suspicion reports received by Medicare this year involved genetic testing scams.
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