Federal effort to target medical fraud - The two-year pilot program will focus on overcharges and fake billings submitted to Medicare by local and south Florida suppliers.

The two-year program, which was developed by the Centers for Medicare and Medicaid Services, will concentrate on fake bills and overcharges sent by suppliers of prosthetic limbs, orthotics, diabetic supplies and durable medical equipment, which includes such items as wheelchairs and nebulizers.

The nationwide figure for such fraud could reach several billion dollars a year, according to Medicare. If the pilot program is successful in reducing fraud in the two regions, it probably will be rolled out nationwide.

"In the Los Angeles area, there are over 4,800 durable medical equipment suppliers. Because there are so many suppliers and such a high number of beneficiaries, it creates an opportunity for this kind of fraud," said Kimberly Brandt, Medicare's director of program integrity.

Federal authorities have long raised concerns about the level of Medicare fraud in Southern California. The U.S. attorney's office in Los Angeles has a special unit of four prosecutors devoted to filing criminal cases. The office also uses civil lawsuits to seek reimbursements for improper billing.

A U.S. attorney's office spokesman said that most cases involve defendants accused of overcharging the federal health insurance program or billing for unnecessary or undelivered services.

In February, a federal grand jury in Santa Ana indicted 18 people, including nine doctors, on charges that involved an alleged scheme to defraud Medicare of more than $12 million. Prosecutors allege that the doctors worked with board-and-care administrators to bill the federal government for respiratory treatment for elderly, sick and mentally ill patients that was unnecessary or not provided.

"Medicare fraud is a huge problem across the country but particularly here in Southern California," said Thom Mrozek, a U.S. attorney's office spokesman. "It's a problem we've been battling for over 10 years now."

The program set to be unveiled by the Centers for Medicare and Medicaid Services will focus on companies that supply medical equipment.

In recent years, Southern California has experienced a steady increase in the number of the suppliers, along with a surge in the amount of money that they have billed Medicare.