The 111 people charged across nine cities are accused of crimes, including conspiracy to defraud Medicare, criminal false claims, money laundering and aggravated identify theft.
"With this takedown, we have identified and shut down large-scale fraud schemes operating throughout the country. This is the largest federal healthcare fraud takedown in our nation's history," said Attorney General Eric Holder who announced the charges with Health and Human Services Secretary Kathleen Sebelius.
Medicare is a government insurance programme that covers Americans who are 65 and older. About 45 million elderly and disabled Americans are enrolled in taxpayer-funded Medicare plans.
Collectively, the doctors, nurses, health care company owners charged in the fraud are accused of falsely billing Medicare of more than $225 million.
Over 60,000 Indian-origin doctors are estimated to be operating in the US which has a total of about 954,000 doctors.
More than 700 agents from the FBI and the Department of Health and Human Services arrested the alleged swindlers in Brooklyn, Chicago, Dallas, Detroit, Houston, Los Angeles, Louisiana, Miami and Tampa.
The agents also executed 16 search warrants across the country in connection with the ongoing investigation.
According to court documents, defendants participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and often never provided.
In Chicago, Indian-origin doctor Jaswinder Rai Chhibber, president and owner of a medical clinic, was arrested and presented in court. He is charged with one count of healthcare fraud.
According to the charges, Chhibber, 48, submitted reimbursement claims for medical procedures he never rendered.
He allegedly performed complicated diagnostic tests on patients without a medical need for those tests besides billing insurance providers for tests never actually performed on patients.
In Detroit, among those charged were Vishnu Pradeep Meda, 30, Ram Naresh Rajulapati, 31 and Surya Nallani, 43.
Nallani was charged with fraud in connection with an approximately $8.5 million physicians visiting group operation.
She billed Medicare for home visits which required her to be physically present, when in fact she was abroad.
In Tampa in Florida, physician Jayam Krishna Iyer was charged with submitting approximately $457,000 in claims to Medicare for services she did not render.
Clearwater physician Iyer, 59, was accused of submitting Medicare claims for services allegedly rendered by another doctor who was excluded from Medicare because of a fraud conviction.
Iyer's attorney, George Tragos, said his client believes she carried out her responsibilities. The accusation "doesn't say that the services weren't performed or the services weren't performed properly."
Another Indian-origin person, Harsh Mehta, 32, owner of a pharmacy, billed the medical insurers for pharmaceutical products he did not dispense.
Assistant Attorney General Lanny Breuer said healthcare professionals from "Los Angeles to New York and cities in between have cheated taxpayers and patients alike by defrauding the Medicare programme".
Thirty-two people were charged in Miami for falsely billing Medicare $55 million for home healthcare, durable medical equipment and prescription drugs.
Twenty-one defendants were charged in Detroit for a $23 million fraud, while in Brooklyn, New York, 10 people were involved in $90 million of false billings.
In Houston, 9 individuals were charged for schemes involving eight million dollars while in Dallas, seven were indicted for conspiring to submit $2.8 million in false billing to Medicare.
In Chicago, charges were filed against 11 individuals for falsely billing Medicare more than $six million.
Last year, federal agencies recovered a record $four billion from fraudsters, Sebelius said.
Four top officials of a leading chain of community mental health centres were also among those charged with the crime.
Among the arrested were Lawrence Duran, owner of American Therapeutic Corp, Marianella Valera, chief executive officer of the company. American Therapeutic is among the nation's largest chain of community mental health centres licensed by Medicare.
The company allegedly altered files of patients with dementia and paid owners of assisted living centres and halfway houses to force the patients to attend programmes at their health centres.
Duran and Valera are being detained in Miami and their case is expected to go to trial in August.
"Our office will be vigilant in ferreting out and bringing to justice those individuals who perpetrate fraud on Medicare, Medicaid and other government health care benefit programs," US Attorney Robert O'Neill said in a statement.