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Posted on 08/03/2026 8:40:36 PM PDT by E. Pluribus Unum
The vibrant, east Asian immigrant enclave of Flushing may be New York’s medical fraud capital.
A one-mile radius of the neighborhood boasts 77 Social Adult Daycares (SADCs), which bill Medicaid over $100 million a year, accounting for 14 percent of all daycare spending in the state, a Post investigation reveals.
When The Post visited some of largest — which are private businesses that have claimed between $20 and 40 million from Medicaid over the last six years — many storefronts were shuttered, and those that were open had empty rooms with no patients.
At Livingwell Day Care on Northern Boulevard, lights were dimmed over rows of empty tables in a mess hall near the entrance. No seniors appeared to be inside, but Livingwell billed Medicaid $27 million from 2018-2024 and had over 26,500 patients, according to federal data.
A man at the front desk refused to answer questions, chased a reporter and cameraman out and threatened to call police. The facility has not been implicated in any crimes.
A woman who identified herself as Wendy, a care worker at Bao Kang Adult Day Care on Blossom Avenue, told The Post she has one or two hundred patients a day, but said “I don’t know” when asked about the $32 million billed to Medicaid for serving 43,900 unique patients during the same years.
Wendy denied The Post a tour, but a security monitor behind her desk displaying common areas showed every single one was empty.
Since The Post’s initial expose on New York’s SADC abuse in January and a federal bust in February saw two men charged with ripping off $120 million over 10 years from Medicaid using two SADCs they owned, workers have been on high alert. Entrances are locked during business...
(Excerpt) Read more at nypost.com ...
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“I Investigated NYC Billion Dollar Fraud Scheme” is a ~53-minute investigative video by independent journalist Nick Shirley (posted around July 10, 2026).
He and his crew examine alleged large-scale Medicaid (and related Medicare) fraud in New York City’s adult/social daycare and personal home care industry, focused on Flushing, Queens. Shirley claims they uncovered over $190 million in suspected fraud. Centers for Medicare & Medicaid Services (CMS) Administrator Dr. Mehmet Oz appears in parts of the investigation.
Background and Scale
Shirley frames the issue as one of the largest ongoing fraud schemes in the U.S. He notes that New York’s government-funded personal assistance programs grew from about $2.5 billion in 2019 to nearly $12 billion by 2025, making it the state’s fastest-growing industry. New York City leads in funding and providers. Flushing has an unusually high concentration—more than 70 adult daycares in a small area (other reports cite ~64 within a one-mile radius). Some centers bill tens of millions of dollars annually, often for recreational activities like tai chi, ping pong, board games, karaoke, art, or massage rather than intensive medical care. Shirley argues taxpayer money is subsidizing these activities (primarily for elderly Korean and Chinese participants) while operators provide cash kickbacks for enrollment and referrals.
Visit to OneTop Senior Daycare Center
The team goes undercover (posing as wanting to enroll a grandmother) at OneTop, which public data shows billed about $5.2 million in 2025 while averaging 276 beneficiaries per day—roughly five times the national average of ~48. The large facility includes a cafeteria, ballroom, massage room, karaoke, art space, pool tables, and music areas.
Staff welcome them and openly discuss the industry. They claim they do not engage in fraud (and previously underwent an Inspector General review with open books showing no margin for kickbacks). However, they say they have lost hundreds of members (down to ~120) because competing centers offer kickbacks. Staff state that “almost every” daycare in Flushing does the same, describing the scheme as centers treating profit margins as money to return to members/referrers (framed as non-kickbacks). Kickbacks are typically per member, per day, or based on referrals (old people recruiting friends). Billing is primarily to Medicaid. Staff offer to point the investigators toward other (allegedly fraudulent) locations and express frustration at losing business by staying “clean.”
Other Confrontations and Examples
Tone, Framing, and Call to Action
Shirley presents the work as citizen journalism exposing waste of tax dollars that could go to legitimate hospital care or other needs. He criticizes insufficient oversight, ties some activity to foreign-linked organized crime (“mafias”), and urges viewers to like, share, and demand accountability. The video includes confrontational street-level reporting, data citations from public databases, and on-site footage of facilities and interactions. Oz emphasizes systemic failures in auditing and the need to stop the “gaming” of the system.
Note: This is a summary of the claims, footage, and interviews presented in Shirley’s video and related contemporary reporting. Specific fraud allegations are under investigation or have led to prior federal actions in the sector; not every center or individual is proven guilty in the video itself. Public data on billing volumes and enrollment concentrations in Flushing has independently drawn scrutiny from officials and media.
Next up, how many of the fictitious people voted?
They weren’t fictitious. They gave them kickbacks to sign up.
Our government is one big fraud.
.
Federal authorities charged Inwoo Kim and Daniel Lee with orchestrating a $120 million Medicare and Medicaid fraud scheme operating through adult day care centers and pharmacies in Flushing, Queens, New York.
The primary details of the case include a Kim-owned pharmacy and two social adult day care centers (Royal Adult Daycare and Happy Life Inc.).
Lee served as the program director at Happy Life. Prosecutors allege the duo billed Medicare and Medicaid for services that were medically unnecessary, never provided, or exceeded the facilities’ permitted capacity.
The centers paid elderly beneficiaries cash and grocery store certificates to induce them to enroll in the day care and to fill prescriptions at Kim’s pharmacy.
You can read the official announcement regarding
the charges on the U.S. Department of Justice web site.
Funny how fraud like this always flourishes in “blue” states, isn’t it?
I’m sure investigators will never be able to follow the money and put 2+2 together though.
June 8, 2017
How Medicare Fraud Schemes Are Perpetrated by Pharmacies
Joshua Pirestani
The abuse of pharmacy benefits is among the most prevalent of fraudulent activities in healthcare.
Fraudulent activities across every sector of healthcare are nothing new. In fact, Medicare and Medicaid fraud alone costs taxpayers estimated billions of dollars annually, according to the Centers for Medicare and Medicaid Services (CMS). No one really knows the actual amount of money lost to fraudulent activities, but that’s not the point. The real problem is cracking down on acts of fraud, which is often difficult considering that both the patients and healthcare organizations contribute to the problem one way or another.
Problems have become so widespread that there’s now a Medicare Fraud Strike Force tasked to hunt and take down anyone engaged in fraud. Medicare also provided information and procedures in reporting fraud, outlining the details required to file a report—such as dates and receipts and which numbers to call. Customers, patients, and employees are urged to report against fraudulent activities if they suspect it or when they have been a victim of it.
Among the many fraudulent activities in the healthcare sector, abuse of pharmacy benefits is the most prevalent. In fact, many pharmacy owners and employees have been arrested for their participation in pharmacy Medicare fraud schemes. The largest takedown happened in 36 Federal Districts, including New York, where a pharmacist was accused of defrauding Medicare and Medicaid by more than $50 million. But how do pharmacists get away with it?
Auto-refilling pharmacy fraud
This happens when a prescription is automatically filled, even when a patient did not request a refill. Without the patient’s knowledge, the pharmacy will then bill Medicare for prescriptions that patients never picked up. They do the same with Federal Employees Health Benefits Program (FEHBP), Medicaid, and TRICARE. Because the prescriptions are still in store, they can rinse and repeat and get away with it.
Auto-refilling pharmacy fraud is one of the reasons that a pharmacist in Janesville, Wisconsin was arrested. He was charged with creating false prescription orders and submitting them for reimbursement, which resulted in Medicare and Medicaid paying him approximately $1 million. The fraudulent activity started between January 2008 and March 2014, and was only discovered when the Wisconsin Department of Health Services conducted an audit.
Kickbacks and bribes
Violations of the anti-kickback statute are among the alleged crimes that conspirators do to commit healthcare fraud. But, even when it is illegal, some pharmacies still give patients gift cards or other incentives to transfer their government-paid prescriptions, making it easier for them to use the prescription for fraudulent activities. Large pharmaceutical companies, on the other hand, bribe pharmacies and pharmacists to switch patients’ medication to a particular drug manufactured by the pharmaceutical company.
One such case happened in California where a physician and pharmacist were charged for allegedly accepting bribes and kickbacks to prescribe expensive pain creams and equipment. The prescriptions were medically unnecessary and may have been part of the $27 million in false claims.
Drug switching fraud
As the name suggests, this type of pharmacy Medicare fraud involves filling a patient’s prescription with a medication that is different from what a doctor prescribed. Switching a patient’s FEHBP, Medicare, Medicaid, or TRICARE prescription for tablet meds to capsule, or vice versa, is considered wrongfully taking money from the government. But many pharmacies commit this fraudulent act to make more money from the government.
Pharmacy benefit managers (PBMs) fraud
Pharmacy claims are processed and paid by PBMs or third-party administrators used by insurance companies, especially those that offer Medicare Part D Prescription Drug Plans. The role of PBMs is to help negotiate for better prices on prescription drugs and make a profit by operating their own mail order pharmacy.
This makes it easier for them to commit several types of PBM frauds, such as switching drugs, shorting medications, paying kickbacks or offering inducements, dispensing adulterated or expired drugs, recycling or reshipping drugs returned by mail order customers, using lock-in pricing that is undisclosed, and keeping manufacturer’s rebates in their pockets instead of passing on the savings to patients.
But the worst form of fraud that PBMs commit is a failure to negotiate prices, which is a blatant disregard of their responsibilities. This type of negligence is already a serious violation, which only adds up when other types of PBM fraud are committed along with it.
In 2006, Medco Health Solutions, an American PBM, allegedly solicited and received kickbacks to promote certain drugs. They received more from insurers and HMOs; however, they ended up paying $155 million when whistleblowers blew their cover.
Under the Federal False Claims Act (FCA), all the fraudulent practices listed above can form the basis for a whistleblower lawsuit, but there must be a whistleblower first.
Medicare Fraud and the False Claim Act
Most the pharmacy care fraud cases were brought to attention by whistleblowers, most of whom are current or former employees. Under FCA, a whistleblower can receive 30% of what the government collects from the companies accused and proven guilty of fraud. And that’s before the damages are tripled, which means the award can add up significantly. This might be the perfect time to be aware of what goes on with your own pharmacy transactions and blow the whistle on pharmacy Medicare fraud perpetrators.
name of a provider or identifying number item or service in question date when an item or service was supposedly delivered or given amount approved and paid by Medicare
date on the Medicare Summary Notice (MSN) Then, provide your name and number and the reasons you think Medicare should not have paid for such a transaction, whether for a product or service.
If you meet all five conditions for your report to be eligible for a reward, you can get paid up to $1,000.
The conditions include that: An alleged fraud is specific, not general. A suspected fraud is confirmed by the Medicare Drug Integrity Contractor, the Program Safeguard Contractor, or the Zone Program Integrity Contractor as fraud.
A suspected pharmacy, pharmacist or organization isn’t already under investigation. At least $100 of Medicare money will be recovered from the fraud reported. It is also important that you are not considered an “excluded individual.” That is, you’re not part of the fraud scheme or that you don’t qualify for another government program’s reward.
Joshua Pirestani is president of the American Pharmacy Purchasing Alliance.
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