(Oxford English Dictionary)
Chiefly N. Amer. (depreciative). An institution that provides education, medical treatment, or a similar service on an intensive basis, primarily for profit. Usu. with modifying word, as abortion, diploma, Medicaid, puppy mill, etc.
1923 Congress. Rec. 12 Dec. 241/2 If the United States mails have been used by self-styled medical institutions and organizations known popularly as 'diploma mills' for purposes of fraud in connection with the sale of degrees or diplomas. 1936 Jrnl. Higher Educ. 7 157 A 'diploma mill' in Ohio was deprived of its charter in 1900, when investigation..disclosed that the president had sold M.A. degrees for $25 each. 1949 S. KINGSLEY Detective Story I. 50 You're still running that abortion mill, aren't you? 1975 Time 26 May 55/2 Many of the 'Medicaid mills' set up to handle poor patients in the nation's urban ghettos reap enormous profits by such practices as 'Ping Ponging' (passing a patient along to all the other doctors in the clinic).
24 September 1973, New York Times, "Welfare-Testing Clinic Once a "Medicaid Mill," pg. 22:
So Mrs. Jameson, a frail-looking woman who hobbled a bit, came with her two sons in tow to the Avenue A Medical Center at 172 East Fourth Street. Her appointment was for 11 A.M., but there was a backlog of patients. Finally, her turn came, and 30 minutes after her name was called, Mrs. Jameson was out of the clinic.
The Avenue A. Center is one of about 20 clinics examining the women on welfare as part of a special city screening program. But in the past the center has had some trouble over its status as a "Medicaid mill."
25 September 1973, New York Times, pg. 47:
Mr. Meyers suggested that because of the large number of welfare clients involved, the examination of the women would be "another Medicaid mill, another merry-go-round."
17 July 1974, New York Times, "Medicaid Hearing is told of abuses," pg. 9:
Dr. Lowell E. Bellin, the city's Health Commissioner, said his agency had drafted, with the support of the five county medical associations, modifications to legislation introduced more than a year ago that would drive "the scoundrels" out of the "Medicaid mills."
24 August 1975, New York Times, "State Sues 3 Medical Centers" by Will Lissner, pg. 73:
Four state agencies have opened a drive on alleged "Medicare mills" -- medical facilities escalating bills under Federal health insurance by "ping-ponging" patients among specialists for unneeded health services -- operating on Long Island.