On the audio: I pushed the wrong button, so instead of me, I got the girl. I don’t mind her, but I don’t think you’ll like her as much as me. I’ll do better next time. I think you can listen to the whole thing whether or not you are a paying member.
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Summary
• Pope Gregory I codified the seven deadly sins around 590 AD. Avarice made the list, ranked fifth of seven by seriousness, with greed for status counted alongside greed for money.
• The Somali Medicaid frauds out of Minnesota now dominate the headlines, $90 million in autism-billing alone, with the broader Minnesota figure exceeding $9 billion. Useful press, narrow story.
• The bigger story is that American physicians and hospitals have run a parallel scam for 50 years that dwarfs anything coming out of Minneapolis. The National Health Care Anti-Fraud Association estimates put system-wide losses at $100 billion a year, and the Government Accountability Office documented over $100 billion in improper Medicare and Medicaid payments in 2023 alone. With all of healthcare costing over $4 trillion a year in America, these figures are conservative.
• Hospitals are the biggest institutional thieves, yet are the most respected. They all have office buildings full of coders whose only job is inflating bills. The 2025 DOJ takedown charged 324 defendants with $14.6 billion in alleged fraud, including 96 licensed medical professionals.
• Oncologists, plastic surgeons, dermatologists, orthopedists, and the workers’ compensation industry each developed their separate gardens of dishonest billing. Some have been able to create statutory exceptions for what would otherwise be felonies.
• The veterinary profession is the latest copycat, with private-equity rollups quoting $12,000 to drain an abscess on a dog. The over-billing cancer has metastasized to anyone who treats a living organism for money.
Introduction
In the late sixth century, a Benedictine monk named Gregory became Pope of a broken civilization. He wrote a commentary on the Book of Job that cataloged the seven deadly sins. Pride, envy, anger, sadness, avarice, gluttony, and lust. Gregory ranked them by the degree to which each offended against love. Avarice landed in fifth place.
That ordering looks merciful to those of us who watched American medicine reorganize itself around the love of money. He also wrote in the same commentary that avarice was not merely the desire for wealth. The avaricious man wanted honors, high positions, and coin. Gregory understood, fourteen centuries before us, that greed wears robes and titles, not money clips alone. The seventh-century desert father saw what a 2026 hospital CEO no longer sees in himself.
Dante, seven centuries after Gregory, placed the avaricious in the fourth circle of hell. They shoved heavy weights at one another, hoarders against squanderers, for eternity. The fifteenth-century Flemish artist Pieter Bruegel the Elder painted an allegory of greed titled Avaritia. A well-dressed woman sits at the center, with coins piled in her lap and a toad at her feet, surrounded by examples of avarice playing out. The Latin inscription at the bottom reads, “Scraping Avarice sees neither honour nor courtesy, shame nor divine admonition.” A reasonable epigraph for the modern American hospital.
The story in the headlines
The current press cycle has focused on the Somali community in Minneapolis. Federal prosecutors have charged dozens of defendants with looting state Medicaid. The schemes used faked autism diagnoses, ghost therapy sessions, kickbacks to recruited parents, and shell clinics staffed by 18-year-olds with no clinical training. The U.S. Attorney’s Office in Minnesota announced in December 2025 that fraud across Minnesota-run Medicaid services exceeded $9 billion.
The lead case, called the largest autism fraud scheme in U.S. Department of Justice (DOJ) history, charged 15 defendants with stealing more than $90 million through a network called Star Autism and similar shops. Abdinajib Hassan Yussuf, 27, the chief executive officer (CEO) of Star Autism Center, pleaded guilty after admitting that he did not know a single individual with autism. Asha Farhan Hassan, 28, was charged with running a $14 million scam through a company called Smart Therapy. Money flowed to Kenya, to semi-trucks, to a federal court docket.
The cultural angle is not the topic of this essay, but it holds up: recently arrived immigrants from countries where the state was treated as a hostile entity to be plundered have brought the same attitude to American social programs. The defendants will go to prison, and they should. Aimee Bock, the convicted mastermind of the related Feeding Our Future case, got a forty-one-year sentence.
What the press coverage gets wrong is the scale. Even at $9 billion, the Minnesota Medicaid fraud cases are a rounding error compared to the larger story. The National Health Care Anti-Fraud Association estimates that total US healthcare fraud amounts to $100 billion a year. The Government Accountability Office (GAO) documented $100 billion in improper Medicare and Medicaid payments in 2023 alone. These are conservative estimates.
The 2025 National Health Care Fraud Takedown, announced by the DOJ on June 30, charged 324 defendants with $14.6 billion in alleged fraud across 50 federal districts. The total more than doubled the previous record of $6 billion. Among the 324 were 96 doctors, nurse practitioners, pharmacists, and other licensed medical professionals. The cases involved fraudulent wound care, prescription opioid trafficking, telemedicine fraud, and a transnational criminal organization called Operation Gold Rush. Medicare recovers only about 2.8 percent of the losses it incurs to fraud each year.
A first-time visitor from Mars, reading the press, would conclude that healthcare fraud in America is an immigrant phenomenon. The Somali cases get the headlines because they are recent, ethnic, photogenic, and politically useful to one side of an argument. The much larger story, the $50 billion or $100 billion or likely far larger annual extraction by white-coated doctors and reputation-laundered hospitals, gets no equivalent attention. The reason is that the latter group includes friends of friends, donors to universities, and advertisers on cable networks. The former is none of those things. The press is doing what the press does.
The amateur leagues: upcoding
Comment: I begin with a confession. In an early phase of my career, I billed Medicare and other insurance carriers for office visits and picked the highest code my chart notes supported. The coding system gave us four levels: basic, intermediate, extensive, and comprehensive. A longer chart note and a few extra check boxes turned a basic into an intermediate, and an intermediate into an extensive. A hundred extra dollars came with each bump.
I never invented a patient. I never billed for a procedure I did not perform. By my colleagues’ standards, I was an amateur. By the standards of Gregory’s avarice, I was a participant.
The upcoding habit is the bottom rung of physician fraud, and it is universal. Every doctor in a fee-for-service practice has felt the temptation. The Current Procedural Terminology (CPT) coding system, used by Medicare and every commercial insurer, lets the doctor specify the level of service rendered.
The doctor coding by the book picks the level that matches the visit. The less scrupulous doctor adds a 15-minute review of systems and an extra examination component, bumping the level. The bill goes up by a couple of hundred dollars. The chart note looks fine on audit because the audit reviews paper, not people, and the paper says what the doctor wrote.
This is the amateur game. The professional game is orders of magnitude bigger. A general surgeon opens an abdomen, removes a gallbladder, looks around, closes the patient up, and codes the operation. What happened inside the abdomen is unknown to anyone outside the operating room.
The pathologist sees the gallbladder. The anesthesiologist sees the monitors. The surgeon sees the operative field and writes the operative note. If the surgeon writes that adhesions required twenty additional minutes of surgical time, that is the record, and Medicare pays. Whatever happens inside the belly becomes whatever was written down.
In residency, I was taught that the operative note is the only record of what happened. The professors meant it as a warning against sloppy documentation. The students heard it as an instruction about who controls the narrative. They were both right.
Dr. David Morrow had a black belt in billing fraud.
His plastic surgery practice was in Rancho Mirage, California, and his specialty was doing insurance billing for people having cosmetic surgery. We knew he was making money because he ran ads in Palm Springs Life Magazine that cost up to $80,000 a month. I thought he was a marvelous marketer, but he was not screening for rich patients. He was looking for people who had fancy insurance plans that could be ripped off.
He billed his nose jobs as deviated septum surgeries. He billed his breast augmentations as treatment of tuberous breast deformities. He billed his tummy tucks as repair of umbilical and ventral hernias. Some of his charges reached $700,000 for a single day’s work on a single patient. He sued his patients’ employers when their medical insurers sensibly refused to pay. He had decades of this behind him before federal prosecutors finally caught up.
The break came when a Morrow patient died during surgery. The plaintiffs’ attorneys, sniffing through his billing records during the malpractice work-up, found the fraud underneath the malpractice. By 2017, Morrow and his codefendant wife were facing decades in prison for an alleged $80 million in fraudulent billing.
Insider Note: Morrow was ratted out by a competitor who knew what he was up to, and he had been hassling this doctor for years. The prosecutors were so stupid that they would never have figured it all out without hours of coaching. Once they finally caught on, however, the Morrows were toast.
The Morrows took a plea bargain. Right before sentencing, they sold their $9.5 million Beverly Hills mansion, wire-transferred the proceeds to Israel, jumped bail, and disappeared. But it soon came to pass that they were ratted out again. It seems that their new neighbors in Israel found their behavior just as arrogant and entitled as their Palm Springs colleagues did, and the police caught them in 2019.
The Los Angeles Times ran the story under the headline “Southern California Plastic Surgeon Extradited Two Years After Fleeing With Fake Passports to Israel.” He and his wife, both in their 70s when they were caught, will die in federal prison.
I knew them, but have no sympathy.
The pair were rotten apples, but their billing practices were just an extreme example of a standard practice. The breast-reduction-for-back-pain dodge is performed every week in plastic surgery offices across America. Some surgeons submit preoperative photos of someone else’s enormous breasts to support fake or exaggerated stories. They often submit narratives of pain that the patient never reported.
The patients are co-conspirators to scams like these. They get their cosmetic surgery for free, with the insurance company paying the bill, and the surgeon is paid at a covered-procedure rate rather than a cash discount. Many hundreds of thousands of dollars a year is a normal income from this kind of work. The fraud is hard to spot unless a staff member or disgruntled patient blows the whistle. After the skin is closed, the evidence is hidden.
The surgicenter facility-fee scam
In California, during the decades when cosmetic surgery centers were being built out, the plastic surgeons’ lobby secured placement of their surgical centers in the same Medicare billing category as hospitals. The maneuver was technical and quiet, negotiated through state legislation and certification standards. Hospitals are allowed to bill “facility fees” for time spent in the building, and these fees are many times greater than the surgeon’s professional fee. The argument has always been that hospitals face huge fixed costs, lobbying, regulations, and a moral obligation to provide charity care. Surgical centers, owned by the same doctors who operate in them, somehow got the same designation. No other industry charges for just walking through the door, but somehow, surgery became an exception.
A plastic surgeon performs a tummy tuck in his accredited surgical center and bills the cosmetic professional fee. His surgical center, owned by him and his partners, bills a separate facility fee of $40,000, $50,000, or more for the same case. The case took three hours. The room itself costs little.
The facility fee gets lost in the hospital billing avalanche, and the insurance company often pays it without question. A knee injection that costs $100 in an office costs $5,000 in a surgicenter, and more if the biller adds ultrasonic guidance and anesthesia. The plastic surgeons who arranged this got wealthy. A number of them stayed wealthy by repeating it ten times a week.
The general principle is that a fee paid for time in a room, with no documented activity to justify the price, is a license to print money. The system pays whoever asks. The patient does not see the bill until it has already been paid.
The orthopedic spine surgery racket
The single biggest fraud case in California history involved back surgeries. Michael Drobot, the owner of a hospital, colluded with orthopedic surgeons to kick back money for referrals. He paid them $10,000 per case. Over the course of the scheme, he distributed $40 million in inducements.
The surgeons billed each operation for about $250,000. By the time prosecutors closed the case, insurers had paid out $600 million. Drobot bribed California state legislators along the way. He went to federal prison for five years.
Spinal fusion surgery, the workhorse of the orthopedic spine industry, is a $12 billion-a-year business in the US, with individual cases costing up to $100,000. Only 15 percent of patients who undergo lumbar fusion for low back pain return to work afterward. The other 85 percent enter a lifetime of pain medication, repeat procedures, and disability. A Cochrane review in 2016 found no controlled studies comparing lumbar fusion with no treatment or placebo. There is no evidence that the surgery works for the broad indications under which it is performed. The orthopedic spine surgeons know this and operate anyway.
Other orthopedic procedures fit the same pattern. Knee arthroscopy for arthritis has been shown by sham-surgery trials to do nothing. The surgery is still performed thousands of times a year. The surgicenter facility fee, the radiologist’s MRI fee, the physical therapy referral, and the orthopedist’s professional fee together generate a multi-thousand-dollar revenue event. Endoscopic knee surgery is a $4 billion-a-year industry in the US. It promotes accelerated osteoarthritis, and except in cases where the knee is locking due to structural problems, the procedure is fraudulent.
There is a blinded, definitive academic literature using sham surgery to compare cases where surgery was performed versus those where it was not, and it supports this premise. If you prefer YouTube videos, here are two. Even the sports medicine specialists are now ashamed of this procedure.
There is a lot more about orthopedics I could cite. One of my friends put it this way: the bone doctors never met a billing code they did not like, regardless of the surgery's lack of utility to the patient. My parting shot is that they are amateur fraudsters who do little damage compared to pediatricians, psychiatrists, and oncologists.
Oncology: the kickbacks enabled by statute
Oncology is the only American medical specialty in which kickbacks are legal. The mechanism is called “buy and bill.” The oncologist purchases chemotherapy drugs wholesale, administers them in his infusion suite, and bills Medicare or the insurance company at retail. The standard markup is 20 percent. By 2013, between 65 and 70 percent of an oncologist’s income was the markup on infusion drugs.
Pharmaceutical sales representatives stay in regular contact with oncology practices to track whether the doctors are “making their quotas” on particular drugs. Companies offer the oncologist higher percentage margins for ordering more of certain medications. The result is direct financial pressure to raise doses and switch patients onto whichever drug has the fattest spread for the doctor.
If two non-oncology physicians made a deal like this, the federal Anti-Kickback Statute and the Stark Law could land them in federal prison. Fee-splitting, where one doctor pays another a commission for referrals, is a federal crime in every other specialty. In oncology, the same financial logic is built into the business model and celebrated at industry conferences.
Otis Brawley, MD, the former chief medical officer of the American Cancer Society until 2018, called it “the dirty little secret of oncology.” Jerome Kassirer, in On the Take: How Medicine’s Complicity With Big Business Can Endanger Your Health (2004), quoted an oncologist who called chemotherapy “our cardiac cath, or our arthroscopy.” The phrase means a profitable procedure that the oncologist owns. Some oncologists in community practice make close to $1 million a year from these drug margins alone.
Graeme Morgan and colleagues, writing in Clinical Oncology in 2004, found that chemotherapy added only 2.1 percent to five-year survival for US adults treated for cancer. Vinay Prasad, MD, reviewed the cancer drugs the U.S. Food and Drug Administration (FDA) approved between 2008 and 2012. 36 of the 54 were approved based on surrogate endpoints, with no demonstrated effect on overall survival. Four years later, only five of those 36 had been shown to extend a single life by a single day.
The 72 new cancer therapies approved from 2002 to 2014 averaged 2.1 additional months of life compared with the drugs they replaced. The newest medications now cost $171,000 per patient per year on average. Some cost $100,000 per dose. Chimeric antigen receptor T-cell (CAR-T) therapy, with hospitalization, costs $1.5 million per patient.
This chemotherapy that does not extend life is sold to dying people by doctors who collect 20 percent of the wholesale price for selling it. The arrangement is legal. The Anti-Kickback Statute does not apply. The Stark Law does not apply. The oncology lobby protected the carve-out, and no Congress has ever moved to close it. Dying patients are an exceptionally easy mark because they will reach for anything.
Dermatology: the AK racket, Mohs, and more
Dermatology in the 1980s was, in the words of a candid practitioner, a specialty in which a clever doctor stayed clean, worked bankers’ hours, and avoided serious problems. The American Academy of Dermatology then hatched a marketing plan to transform the specialty into a high-revenue, cancer-fighting operation. They hired a Madison Avenue public relations firm for $2 million to design the campaign.
The product was the redefinition of actinic keratoses (AKs), the rough sun-spotted bumps that most older fair-skinned people accumulate, as “precancerous lesions” requiring treatment. Half of all AKs disappear without treatment. One percent become skin cancer after one year. Four percent become skin cancer after four years, and these are almost all slow-growing basal or squamous cell cancers that pose no threat to life.
The dermatologists’ business model now hinges on freezing as many AKs as possible per visit. An Advanced Dermatology and Cosmetic Surgery physician assistant publicly disclosed that her supervising doctors instructed her to freeze up to 30 bumps per patient encounter. Advanced Dermatology, owned by the private equity firm Harvest Partners, has 4 million patients, 192 physicians, 124 physician assistants, and over 180 locations. They train the PAs to take over locations where no physician is present. Patients are encouraged to return every three months for a “complete skin exam to check for cancer,” and anything sticking up gets cut off or frozen. Medicare pays.
Their premium product is Mohs micrographic surgery, designed in the 1930s for selected high-risk skin cancers in critical facial locations, but now performed indiscriminately. Mohs involves removing a skin lesion in thin slices, examining each slice under a microscope between cuts, and continuing until the margins are clear. The procedure is billed per slice, per microscopic examination, per reconstruction. A dermatologist I know does ten Mohs cases every Friday for $15,000 each.
Robert Stern, MD, a Harvard dermatologist, understated the case by a hundred miles: “The decision to utilize Mohs is likely to reflect the economic advantage to the provider rather than a substantial clinical advantage for the patient.” The total US spend on Mohs reached $2 billion by 2012. Most of the cases would heal as well with the older, cheaper method of curettage and electrodesiccation, followed by a few months of observation. The older method costs the patient nothing extra, and the system almost nothing at all.
Out-of-network bills
The cleanest way to extract money from an insured patient is to be the doctor he never met. Hospital-based specialists, including pathologists, anesthesiologists, radiologists, emergency physicians, and most recently neonatologists, have systematically left insurance networks while continuing to work in network hospitals.
The patient checks into an in-network facility, has surgery scheduled, and wakes up with bills for tens of thousands of dollars. The bills come from doctors he never chose, who never came into the room, and whom he had no right to refuse, even if he had known. In 2017, more than 15 percent of insured American patients received outrageous out-of-network bills despite being treated at in-network hospitals.
This is the No Surprises Act problem, partly addressed by federal legislation in 2022, yet still routinely circumvented by specialists’ billing companies. Forty-three million Americans now carry medical debt on their credit reports. Medical bills were the leading cause of personal bankruptcy in 2019. The out-of-network billing model is a swindle dressed as a fee schedule, and the courts have never seriously confronted it.
Hospitals: the sharks at the top of the food chain
If physicians invented small-time fraud, hospitals industrialized it. Hospitals consume about one-third of US healthcare spending, more than $1 trillion a year. Over 75 percent of American hospitals and eight of the ten largest are “nonprofit.” Many began as Catholic charity operations run by nuns.
The nonprofits are now indistinguishable in business behavior from for-profit corporations. They pay no taxes and answer to no shareholders. Profit margins at the top systems exceed 30 percent. The money is spent on executive compensation, expansion, Zen gardens, marble lobbies, and the acquisition of physician practices. When a hospital buys a doctor’s office, the office’s collections double or triple because the same services get rebilled under hospital facility codes.
The Providence Portland Medical Center is a textbook case. Founded in the mid-eighteenth century by nuns as a Catholic nonprofit, Providence grew over the past 25 years into the third-largest healthcare system in the US. It bought hospitals across multiple states. It hired professional administrators and hundreds of coders.
By 2013, revenues were $2.6 billion, and the top administrator was paid $3.5 million. After Providence bought Seattle’s Swedish Hospital, five neurosurgeons there each billed Medicare more than $50 million in a single year, and the top one billed $87 million. The hospital continued to advertise itself as a “not-for-profit Catholic health care ministry” sponsored by nuns.
The chargemaster is the heart of hospital fraud. This is the price list hospitals use to bill anyone without pre-negotiated rates. A Tylenol on a chargemaster is $10, a gauze pad is $60, and an alcohol pad is $8. A chest X-ray is billed to the chargemaster at $289, but is paid by Medicare at only $32. Blood draws bill $36 each.
Medicare strips out most of this on the back end. It pays only what it considers a reasonable amount, sometimes 20 percent of the original bill. Uninsured patients get the full chargemaster. So do out-of-state, out-of-country, and out-of-network patients. The chargemaster prices are fictional in the sense that no one inside the industry will explain them, and they have force only because the courts enforce them.
Steven Brill’s 2013 Time cover story, “Bitter Pill,” walked through the chargemaster industry in detail. The hospital executives Brill interviewed were apologetic in person about their pricing and intransigent in writing. The wallet biopsy, the credit check performed on a patient’s Social Security number before any clinical procedure begins, is now standard practice across large hospital systems.
The hospital determines how much it will extract before it begins to render care. The clinical care follows the credit decision. This is what the institutions our communities once funded with bake sales have become.
A cottage industry of medical billing advocates now exists to negotiate hospital bills down. They charge $100 an hour or, more lucratively, a percentage of “savings.” A competent billing advocate cuts a hospital bill by 30 percent on the first phone call, simply by identifying junk charges and asking that they be removed.
The hospitals know what they billed. They billed it knowing most of it would not survive scrutiny. The strategy is volume. Most patients never push back; the advocates handle only so many cases, and the average overbill goes through.
Hospitals also pay physicians who work there based in part on the doctors’ willingness to upcode. Hospital coders monitor doctors’ billing and pressure them to bill higher. A common message: “If you get X-rays and order a pain shot for that back patient in the emergency department, you could justify a level 5 instead of a level 3 charge.” The doctor is being told to order unnecessary studies and therapy to inflate the bill. This is a fraud committed by the hospital using the doctor’s signature.
Workers’ compensation: the second-worst system
The US workers’ compensation system, in theory, exists to streamline the payment of benefits for work-related injuries and to avoid litigation. In practice, it is a litigation engine. Insurance company overhead and profit consume 36 percent of every premium dollar. Lawyers consume another 5 percent of the system. Doctors incur another 10 percent in billing costs and administrative costs due to years of payment delay.
Fraud estimates run to $30 billion a year. Add up the leakage and roughly 75 percent of every premium dollar departs the system before a patient gets a single visit.
Personal injury law works on a similar lien system, and it is the worst health care delivery I know of. The doctor bills on a lien, the lawyer bills on a contingency, and the patient gets a third of the eventual settlement. The traditional rule of thumb is that the settlement equals three times the doctor’s bill.
The doctors inflate the bill, the patients exaggerate the injury, and the lawyers coach both sides on how to maximize the award. Some Los Angeles personal injury physicians make $2 million a year working 20 hours a week. One described his billing as a “grey area.”
Comment: I worked a few personal injury cases early in my career. The lawyers were happy to coach me on how the lien system worked, what to chart, what to leave out, and how to structure the visit notes for maximum value at settlement. I did not enjoy the work because it bordered on fraud. The patients were not interested in getting better; the lawyers were not interested in an accurate evaluation; and the system rewarded fiction. I got out of it within a year. My friends who stayed in personal injury made a boatload more money than I did.
Veterinarians join the racket
The infection has now spread to veterinary medicine. A local Los Angeles animal hospital recently quoted us $12,000 to drain an abscess on the neck of our 150-pound Cane Corso. The veterinarian said the procedure would take three hours and would require a pre-operative magnetic resonance imaging (MRI) scan to evaluate the lesion.
My wife, Judy she is our family negotiator. She asked who would read the MRI, because most veterinary clinics do not employ veterinary radiologists. I asked why a procedure that has been performed with a finger and a scalpel for two thousand years suddenly required imaging. The bill dropped to $5,000 on the spot. The MRI requirement evaporated. The three-hour procedure stayed on the bill.
I have drained hundreds of abscesses in humans over 30 years of practice. The technique is identical across species. A skin incision, a gloved finger sweep to break up the loculations, and a hole left open for drainage. The work takes 15 minutes. With induction and recovery from general anesthesia, the entire case in a dog takes at most an hour. Three hours is fiction.
The surgery was successful. Two small “foxtail” foreign bodies were found in its neck, and the dog went home with us. Several days later, the surgeon refunded $800 of the bill without explanation. The final cost was $4,200, a price reduction from the opening bid, but still outrageous.
Veterinary spending in the US reached $37 billion in 2023. The average veterinary visit has risen by 60 percent in the past decade, roughly twice the general inflation rate. Thirty-seven percent of pet owners went into debt in 2024 to pay for veterinary services.
Mars Petcare now owns Banfield, VCA, BluePearl, and AniCura. National Veterinary Associates, Pathway Vet Alliance, and PetVet Care Centers are all private-equity-controlled rollups. About 25 percent of US veterinary clinics now sit inside one of these chains. CareCredit, a Synchrony Financial product, finances the gap at 26 to 32 percent annual percentage rate (APR). The deferred-interest gimmick backdates interest from day one if the customer misses the payoff date by 24 hours.
Veterinary medicine copied the human medical playbook with a 20-year lag and none of the regulatory friction. Vets saw the dermatology mills, the surgical centers, and the facility fees. They observed that no one goes to jail and that most billing practices are protected by lobbyists. They adapted the model for animals.
The MRI scanner in my local animal hospital costs roughly $1.5 million. Every animal that walks through the door is a candidate for amortizing that capital expense. The Cane Corso did not need an MRI to diagnose an abscess. The MRI machine needed the Cane Corso.
In my opinion, the vets are not original sinners. They are the imitators. The physicians set the example. The dogs’ owners are the latest victims.
The healthcare foundation of trust, and why it has held this long
American medicine was built on honesty rooted in Christian moral philosophy. The doctor’s word in the chart is the document of record because no one outside the operating room verifies what happened inside. The hospital’s billing reflects the services rendered, because no one audits every IV bag and every code blue.
The patient is presumed to be telling the truth about his symptoms, because the alternative is to treat every encounter as adversarial. The system rests on the assumption that the people inside it are operating in good faith.
That trust has been cashed in. The Morrows of the world wrote down fake operations. The oncology lobby wrote itself a kickback exemption. The hospitals built office buildings full of coders whose only job is to extract maximum revenue from the chargemaster fiction.
The dermatology PA freezes thirty bumps because her boss told her to. The surgeon codes the longer operation because the hospital pays him more for it. The plastic surgeon’s facility bills $50,000 for a few hours in a room. The trust holds because the trust is structural, and structures are slow to fall. But it is falling.
The newer entrants to the system did not invent anything new. DOJ charged a Russian-Armenian crime ring out of Glendale in 2010 with $163 million in fake clinics. The Minnesota Somali autism mills and the Florida durable medical equipment scams work the same template. They exploited an infrastructure of trust that the professional class had already weakened.
Where physicians once upcoded, the new entrants invented patients. Where hospitals billed phantom services, the new entrants billed phantom patients. The frauds escalated because the prior frauds went unpunished. The professional class set the floor, and the criminal class found the basement below it.
The most recent estimates from the U.S. Attorney’s Office put Minnesota’s Medicaid fraud loss above $9 billion. The Operation Gold Rush case, charged in June 2025 in the Eastern District of New York, scheduled $4.45 billion in Medicare payments to an Estonian-Russian criminal organization that had stolen 1 million American identities. The government prevented all but $41 million of that from being paid, but $900 million in supplemental insurance payments are gone, unrecovered. The new criminals are louder and more obvious than the old criminals, but they are working the same vein.
Christianity built the moral framework that allowed American medicine to operate as a high-information, low-audit profession, but this morality is gone. A vein of trust still runs through the system, generated by a culture that the institutions no longer embody. Each new generation of operators, foreign-born and native, encounters that vein and exploits it. The professional class started extracting from it in the 1970s. The criminal class arrived once the vein had been tapped.
What I did not do, what I might have done
I did not bill for fictitious patients. I knew people who did, or whose office staff did, and a few of them went to prison. I knew many more who were never caught.
I did not bill cosmetic surgery as a medical procedure, the David Morrow play. My office did not file insurance claims for the last three quarters of my career. I did not run a surgical center that billed facility fees. I did not work in oncology, where the law lets you keep the kickback.
Looking at medical corruption every day is the project I assigned myself in retirement. The volume in American medicine is more than can fit in my head at once. The response I have when I read about a new case is not anger but nausea.
I want to projectile vomit when I think about the cumulative cost of what my profession has done: the patient lives destroyed by overprescription and unneeded surgery, the families bankrupted by hospital bills, the cancer patients dying on the third-line chemo their oncologist bought wholesale.
My wife, Judy, pushed back on my dog’s $12,000 quote and got it reduced to $4,200 in a single conversation, which is the image of the entire system in miniature. The opening number is fiction. The negotiated number is closer to what the work was worth. The difference is the markup the system has been allowed to steal.
Our entitlement programs are furnished at no or minimal cost to the recipient. They are rife with fraud and a complete failure. I don’t have solutions, but there has to be some feedback between the person who gets the benefits and the cost of it all.
All this said, the financial chicanery is petty thievery compared to the fraud, damage, and ineffectiveness of the vast majority of today’s medicine delivered according to today’s “standard of care.” What an absurd phrase that is.
Back to Pope Gregory
He ranked avarice fifth of seven by the degree to which it offended against love. In his reading, avarice was the love of money that displaced the love of God and neighbor. It had not yet escalated to violence against the neighbor.
Gregory did not see what would happen when avarice married scale, technology, and the language of healing. He did not see a 25-year-old in Minneapolis billing Medicaid for autism therapy he never delivered. He did not see a 70-year-old plastic surgeon in Rancho Mirage billing $700,000 for a single day of cosmetic work. He did not see a hospital system founded by nuns paying its CEO $3.5 million a year and chasing the assets of a dying patient. He did not see a dermatology private equity rollup freezing thirty actinic keratoses per visit on a captive population of 4 million.
By accident, the seven deadly sins now serve as a taxonomy for the American hospital. Avarice is the dominant sin, but it brings its companions. Pride is the white coat, envy is the specialty turf war, and anger is the lawsuit. Sloth is the failure to read a chart, gluttony is the chargemaster-billed Tylenol. Lust is for the next acquisition, the next bonus, the next compensation panel seat. Gregory in 590 AD would not have recognized the technology, but would have understood the doctors.
The remedy, if there is one, is the patient’s or dog owner’s response: looking at a $12,000 bill, asking one question, and watching the price collapse. Most people are not equipped to do that because they lack the medical training to know what to ask. The asymmetry of information is the same thing that has hollowed out the larger system.
We must all ask about the price first, refuse unnecessary imaging, demand that the procedure be explained in detail, and walk out when the numbers do not add up. The system punishes greed only when customers stop paying. The state regulators are captured. The professional societies are publicists for the rollups. The only useful resistance happens at the front desk, in the moment, by the patient who has read enough to push back.
Our dog is asleep on the rug as I write this. He has no opinion on private equity, the Anti-Kickback Statute, or the Seven Deadly Sins. He knows that he was sick and now he is not. In the end, the bill was $4,200 for a 60-minute procedure. Worth it for the dog. Outrageous as a number. American.
Most of the material in this essay is drawn from my book, Butchered by “Healthcare.” It is about ten times as long and goes considerably deeper. Chapter 30 covers billing scams and specialty warfare. Chapter 32 dissects the hospitals. The rest is a working survival guide: which procedures to refuse, which drugs to question, how to find a doctor who is not on the take, and how to negotiate a hospital bill that has already been padded. If the cathedral of fraud described here matters to you, that is where to find more about it.
Selected references
• Butchered by “Healthcare” (2020), Robert Yoho, MD. The primary source for most of the physician-fraud and hospital-fraud detail in this essay.
• Six Additional Defendants Charged, One Defendant Pleads Guilty in Ongoing Fraud Schemes, U.S. Department of Justice, December 18, 2025. The Minnesota Star Autism, Smart Therapy, and related Medicaid fraud charges.
• National Health Care Fraud Takedown Results in 324 Defendants Charged in Connection with Over $14.6 Billion in Alleged Fraud, U.S. Department of Justice, June 30, 2025. The 2025 DOJ takedown, including Operation Gold Rush.
• Inside the mind of criminals: How to brazenly steal $100 billion from Medicare and Medicaid, CNBC, March 9, 2023. Source for the $100 billion annual fraud estimate from the National Health Care Anti-Fraud Association.
• Medicare and Medicaid: Additional Actions Needed to Enhance Program Integrity and Save Billions, U.S. Government Accountability Office, April 16, 2024. The $100 billion in improper payments figure for fiscal year 2023.
• Dozens Charged in $163M Medicare Fraud Scheme, CBS News, October 13, 2010. The Mirzoyan-Terdjanian Russian-Armenian organized crime case out of Glendale.
• Bitter Pill: Why Medical Bills Are Killing Us, Steven Brill, Time, March 4, 2013 (PDF mirror). The chargemaster investigation that named hospital billing for the public.
• How the Seven Deadly Sins Began as ‘Eight Evil Thoughts’, History.com. Background on Gregory I, Evagrius Ponticus, and the development of the list.
• On the Take: How Medicine’s Complicity With Big Business Can Endanger Your Health, Jerome Kassirer, MD (2004). Source for the “dirty little secret of oncology” line and the structural critique of fee-for-service oncology.
• U.S. Attorney: Fraud likely exceeds $9 billion in Minnesota-run Medicaid services, Minnesota Reformer, December 18, 2025. The current Minnesota fraud total.
