Chicago DEA Healthcare Defense Lawyer

Chicago DEA Healthcare Defense Lawyer: The City That Created America’s First Medicare Fraud Strike Force Now Has 6 Prosecutors Dedicated to Taking Your License – and Your Freedom

The U.S. Attorney’s Office for the Northern District of Illinois just created a new Healthcare Fraud Section with six dedicated federal prosecutors. This is the first time the Office has ever created such a section. The current U.S. Attorney has charged nearly $2 billion in healthcare fraud schemes since taking office. In the 2025 National Health Care Fraud Takedown – the largest healthcare fraud enforcement action in Department of Justice history – 13 defendants in the Northern District faced charges for schemes involving $1.83 billion billed to government programs and private insurers. That’s not national numbers. That’s Chicago alone.

Chicago isn’t just another city for DEA healthcare investigations. It’s the birthplace of aggressive federal healthcare fraud prosecution. The Chicago Medicare Fraud Strike Force, created in 2007, was the government’s pilot program for specialized healthcare prosecution. That initiative was so successful it became the model for 27 federal districts nationwide. Now Chicago has evolved that model into something more permanent – a dedicated section within the U.S. Attorney’s Office focused entirely on prosecuting healthcare providers. When DEA investigators in Chicago identify you for scrutiny, you’re facing the most experienced, best-resourced healthcare fraud prosecution machine in the country.

The strike force model has been devastatingly effective. Since 2007, Health Care Fraud Strike Force programs across the country have charged more than 5,800 defendants who collectively billed federal health care programs and private insurers more than $27 billion. Chicago pioneered this approach. The prosecutors you’re facing learned their craft building the template other districts now follow. The investigation techniques, the prosecution strategies, the coordination between DEA Diversion Investigators and federal prosecutors – all of it was developed and refined here first.

The City That Pioneered Aggressive Prosecution

Heres what makes Chicago different from other federal districts. In 2007, the Department of Justice created the Chicago Medicare Fraud Strike Force as a pilot program. The concept was simple: dedicate specialized resources to healthcare fraud prosecution instead of treating it as part of general criminal dockets. The results were immediate. Case volume increased. Conviction rates stayed high. The model worked so well that DOJ expanded it to 27 federal districts nationwide.

But Chicago didnt stop there. In 2019, the U.S. Attorneys Office created the Opioid Task Force specificaly to combat unlawful distributions of controlled substances. Now theres a third layer – the Healthcare Fraud Section created in August 2025 with six dedicated prosecutors led by Heidi Manschreck as Section Chief and Prashant Kolluri as Deputy Chief.

Think about what three layers of specialized prosecution means for healthcare providers in the Northern District of Illinois. Your not facing a general crimes unit that handles healthcare cases occasionally. Your facing prosecutors who do nothing but healthcare fraud. Who have spent years developing expertise in medical billing, controlled substance regulations, and DEA enforcement. Who have institutional memory from thousands of prior cases. Who know exactly how to characterize your prescribing patterns as distribution rather then treatment.

Heres the uncomfortable truth about practicing medicine in Chicago. The same city that pioneered aggressive healthcare fraud prosecution is the city were you have a medical practice. The prosecutors who developed the template that 26 other districts now follow are the prosecutors who will handle your case. The strike force concept that changed federal healthcare enforcement nationwide was invented to prosecute providers like you.

Three Layers of Prosecution Infrastructure

The Northern District of Illinois has three seperate enforcement structures dedicated to healthcare cases, and understanding how they interact matters for your defense.

• The Medicare Fraud Strike Force was the original unit, created in 2007 as part of a joint DOJ-HHS initiative. Strike Force prosecutors work closely with FBI agents, HHS-OIG investigators, and state law enforcement. Theyve charged billions in fraudulent billing and established the aggressive prosecution culture that defines Chicago healthcare enforcement.
• The Opioid Task Force was added in 2019 specificaly to address controlled substance violations. This unit focuses on the DEA side of healthcare enforcement – unlawful prescribing, diversion of controlled substances, pill mill operations. When DEA Diversion Investigators identify problematic prescribing patterns, this is the unit that evaluates criminal referral.
• The Healthcare Fraud Section, created in August 2025, represents the permanant institutionalization of these efforts. Six dedicated prosecutors means this isnt a temporary initiative. Its a permanant feature of the Northern District’s criminal division. The section will handle complex healthcare fraud prosecutions, coordinate with the other units, and develop the next generation of enforcement strategies.

Heres the consequence cascade that these layers create. A DEA audit identifies unusual prescribing patterns. The Diversion Investigator consults with supervisory personnel – and with prosecutors – to determine if criminal prosecution is warranted. Your case may move through the Opioid Task Force if it involves controlled substances, or the Healthcare Fraud Section if it involves billing fraud, or both if the government decides to pursue multiple theories. Each layer has specialized expertise. Each layer has dedicated resources. And all three layers share information about your practice.

The 2025 Takedown

In June 2025, the Department of Justice announced the largest national healthcare fraud enforcement action in history. Over 320 defendants were charged nationwide for allegedly participating in various healthcare fraud schemes involving more than $14.6 billion in intended losses. The government seized more then $245 million in cash, luxury vehicles, cryptocurrency, and other assets.

Thirteen of those defendants were in the Northern District of Illinois. Those 13 defendants were charged with crimes related to healthcare schemes involving more then $1.83 billion billed to government programs and private insurers. The fraud schemes caused more then $865 million to be paid in fraudulent reimbursements.

Heres what $1.83 billion from 13 defendants means. Thats an average of over $140 million per defendant in alleged fraudulent billing. These arent small cases. These are mega-prosecutions targeting what the government characterizes as major fraud operations. Five of those defendants were charged in connection with a $703 million scheme involving stolen Medicare beneficiary identification numbers and artificial intelligence used to create fake recordings of patient consent.

The 2025 takedown was the largest healthcare fraud action in the Northern District’s history. Not the largest that year. The largest ever. And it happened in a district that already had the Strike Force and the Opioid Task Force. The creation of the Healthcare Fraud Section followed immediatly – a clear signal that the government views these results as the beginning, not the culmination, of intensified enforcement.

What Gets You Targeted in Chicago

DEA Diversion Investigators in Chicago follow the same basic patterns as investigators elsewhere – but with more resources, more experience, and closer coordination with prosecutors. Understanding what triggers investigation matters becuase Chicago’s threshold for escalation may be lower then other districts.

Unusual prescribing patterns attract attention:

• Prescribing volumes that exceed peer comparisons
• Controlled substance prescriptions without corresponding patient visits
• Geographic patterns suggesting patients travel unusual distances
• Payment patterns showing cash-only practices

Any of these can trigger initial review.

The hidden connection that matters: DEA Diversion Investigators work closely with prosecutors from the beginning of significant investigations. DIs collect and analyze information, then consult with supervisory personell to determine if criminal prosecution is warranted. In Chicago, that consultation happens with prosecutors who specialize in exactly your type of case. The decision to pursue criminal charges is informed by institutional expertise from thousands of prior prosecutions.

Heres the cascade that destroys practices:

DEA audit → records review → patient interviews → additional document requests → grand jury subpoena → criminal charges → arrest

At each stage, the information gathered becomes evidence for the next stage. The audit that seemed administrative becomes the foundation for criminal prosecution. By the time you realize the trajectory, substantial evidence has been gathered against you.

The 2025 takedown included 93 administrative cases seeking revocation of DEA registrations for pharmacies, medical practitioners, and companies. Those administrative cases represent the pipeline feeding criminal prosecution. DEA can pursue administrative revocation independantly of criminal charges – but administrative proceedings often run paralell to criminal investigation, and the information gathered in one proceeding informs the other.

Heres the hidden machinery that operates in Chicago. Shane Catone, Special Agent in Charge of the DEA Chicago Field Division, stated that the new Healthcare Fraud Section “will only enhance our capabilities to keep Americans safe from anyone who exploits financial, pharmaceutical, and criminal systems.” That enhancement isnt abstract – its additional resources dedicated to investigating and prosecuting providers like you. The coordination between DEA investigators and federal prosecutors that was already tighter in Chicago then most districts is now more formalized, more resourced, and more focused.

The Allcare Pharmacy settlement illustrates how administrative enforcement operates. An inspection and audit by the DEA found that the pharmacy failed to keep adequate records pertaining to the receipt and disposition of various controlled substances, including hydrocodone-acetaminophen and alprazolam. The settlement was announced jointly by the U.S. Attorney and the DEA Special Agent in Charge – demonstrating the coordination between investigative and prosecutorial components. Record-keeping violations that seem administrative become the basis for enforcement action that can destroy a business.

The Dr. Demorest Trap

Two suburban Chicago physicians were sentenced to federal prison in December 2023, and there case illustrates a trap that catches providers who think theyve solved there DEA problem.

Dr. Stanley David Demorest managed Demorest Consultants LLC, a medical practice in Melrose Park. Dr. Nicholas Recchia was employed there as a physician. From 2015 to 2020, they agreed to dispense hydrocodone, oxycodone, fentanyl, and other controlled substances to individuals who visited the practice but whom they knew had no legitimate medical need for the drugs.

Heres the detail that made Demorest’s situation dramatically worse. He voluntaraly surrendered his DEA Registration Number in 2015. He lost his ability to lawfully prescribe controlled substances. Problem solved, right? No more DEA scrutiny becuase no more DEA registration?

Wrong. Demorest used Recchia’s name and DEA Registration Number to issue prescriptions after surrendering his own. The voluntary surrender that seemed like a solution became evidence of additional crimes. He was charged not just with healthcare fraud but with unlawfully using another person’s DEA registration number to dispense controlled substances. U.S. District Judge John F. Kness sentenced Demorest to two years in federal prison. Recchia, who allowed his number to be used, received six months.

Think about that inversion. The doctor who surrendered his registration got two years. The doctor who kept his registration and let it be misused got six months. Demorest’s attempt to distance himself from DEA oversight backfired completly. The surrender didnt protect him – it created new charges that increased his sentence.

Administrative to Criminal Pipeline

Dr. Eliza Diaconescu was 74 years old when she was sentenced to six months in federal prison. Her crime: pre-signing prescriptions for hydrocodone, oxycodone, and fentanyl so they could be provided to patients when she wasnt at her Gurnee pain clinic. She admitted this practice continued from 2016 to 2021.

Think about what pre-signing means legally. Every prescription was issued without a contemporanious patient examination. The prescriptions were distributed in her absence. The practice continued for five years before federal prosecution. When the investigation concluded, a 74-year-old physician went to federal prison for administrative convenience that prosecutors characterized as healthcare fraud.

The administrative to criminal pipeline operates continuosly in Chicago. In the six months surrounding the 2025 takedown, DEA charged 93 administrative cases seeking revocation of pharmacies’, medical practitioners’, and companies’ authority to handle or prescribe controlled substances. Each administrative case represents a practice that attracted DEA attention. Each practice that lost DEA registration represents a provider whose professional life was destroyed – even without criminal charges.

Heres the uncomfortable truth about administrative proceedings. They run on a lower standard of proof then criminal cases. DEA can revoke your registration based on findings that wouldnt support criminal conviction. But the evidence gathered in administrative proceedings can inform criminal investigation. The documents you produced, the testimony you gave, the admissions you made to try to save your registration – all of it can become evidence in subsequent criminal prosecution. The administrative proceeding that seems less serious becomes the discovery mechanism for the criminal case.

John A. Greager II, who owned and operated Cancer Therapy Associates in Lombard, was sentenced to federal prison and fined $1 million for healthcare fraud. Dr. Kirk Hopkins allegedly earned more then $5.5 million by falsely billing Medicaid and Medicare for psychotherapy services that were never performed. These cases represent different aspects of healthcare fraud enforcement – billing fraud, service fraud, documentation fraud – but they share a common origin: investigations that began with pattern recognition and escalated through the administrative-to-criminal pipeline.

What Actually Protects Chicago Providers

If your a healthcare provider in the Northern District of Illinois and your concerned about DEA investigation, what actualy protects you?

First: Understand that Chicago pioneered aggressive healthcare fraud prosecution and now has the most developed enforcement infrastructure in the country. The Strike Force, the Opioid Task Force, the Healthcare Fraud Section – these arent abstract threats. Theyre specialized units with dedicated prosecutors who handle nothing but cases like yours. Your defense strategy must account for the sophistication and resources your facing.

Second: The 2025 takedown charged 13 defendants with schemes totaling $1.83 billion. Chicago prosecutors pursue mega-cases. But they also pursue smaller cases – Dr. Diaconescu’s pre-signed prescriptions, Dr. Demorest’s practice. Size dosent determine wheather you get prosecuted. Pattern does.

Third: Surrendering your DEA registration dosent end your exposure. Dr. Demorest surrendered his registration and ended up with a longer sentence then his colleague who kept his. If your considering voluntary surrender as a strategy, understand the potential consequences – including what happens if prescribing continues through other means.

Fourth: Administrative proceedings are not seperate from criminal proceedings. They run in paralell. Information flows between them. DEA charged 93 administrative cases seeking revocation in six months. Many of those practices also face or will face criminal investigation. Treat administrative proceedings with the seriousness of criminal cases becuase thats how the government treats them.

Fifth: The administrative-to-criminal pipeline is real and operates continuosly. DEA Diversion Investigators consult with prosecutors to determine if criminal prosecution is warranted. That consultation happens with Chicago prosecutors who specialize in healthcare cases. The decision to escalate is informed by extensive institutional experience.

Sixth: Pre-signing prescriptions, using colleague’s DEA numbers, prescribing without examinations – these practices that may seem like administrative shortcuts are federal crimes when prosecutors decide to characterize them that way. Dr. Diaconescu’s pre-signing was characterized as healthcare fraud. Dr. Demorest’s use of a colleague’s number was charged seperately from the underlying prescribing.

Seventh: Get counsel immediatly if you learn of any DEA interest in your practice. The Chicago enforcement infrastructure means investigations move efficiently from audit to prosecution. The prosecutors handling your case have seen hundreds of cases like yours. The time to develop your defense strategy is before the investigation advances – not after indictment when the evidence has been gathered and the prosecutors have locked in there theory.

Thats the reality of practicing medicine in Chicago. A city that pioneered aggressive healthcare fraud prosecution. That created the strike force model other districts now follow. That has three layers of specialized prosecution infrastructure. That just announced the largest healthcare fraud enforcement action in its history – and responded by creating a permanant six-prosecutor section to pursue more cases. The providers who navigate this environment successfuly arent those who assume Chicago operates like other districts. There the ones who understand that the most experienced healthcare fraud prosecutors in the country are the prosecutors evaluating wheather to charge them – and who structure there practices and there responses accordingly.

The cases that end well in Chicago share common characteristics:

• The providers engaged counsel before investigation advanced past the initial audit stage
• They understood that administrative inquiries could become criminal investigations and treated them accordingly from the beginning
• They documented there prescribing decisions contemporaniously, creating records that demonstrated legitimate medical purpose before anyone asked questions
• They recognized that Chicago’s three layers of enforcement infrastructure meant there case would be handled by specialists – and they retained defense counsel with equivalent specialization
• They understood that the same strike force model that revolutionized federal healthcare enforcement was the model that would be used against them

What dosent protect you in Chicago: assuming the government will distinguish between administrative error and criminal intent. Assuming that cooperation will earn goodwill from prosecutors who have seen thousands of cooperating defendants. Assuming that small practices escape notice while the government focuses on mega-cases. The 2025 takedown included both $703 million schemes and individual physicians like Dr. Diaconescu. Size dosent determine prosecution – pattern does. And in Chicago, the prosecutors evaluating your pattern have more experience then prosecutors anywhere else in the country.