Wheelchair fraud is in the news again, as two men in Texas pleaded guilty to submitting fraudulent claims to Medicare for power wheelchairs. In the past year, the Federal government has taken many steps to crack-down on power wheelchair fraud. In February 2004, the Deptartment of Justice announced 11 arrests in Texas as the result of Operation Roll Over. In September 2003, the Centers for Medicare and Medicaid Services (CMS) announced Operation Wheeler Dealer, a ten point plan to curb wheelchair fraud in the Medicare program. At the end of April 2004, CMS announced new payment guidelines to make sure that people who need wheelchairs get them and people who don’t, don’t.
Fraud happens every day in every healthcare system. The majority of fraud remains undetected (and thus invisible) forever. Because most fraud is invisible, we tend to focus only on what we know about. This is a big mistake. However, ignoring known scams would be an even bigger mistake. I’ve collected information about cases around the US to give you an overview of the wide variety of methods of operations we know about. This is just the tip of the iceberg.
Florida authorities have arrested participants in an alleged $10 million prescription drug fraud ring. Carlos Luis, Adalberto Hernandez, Edward Safille, Eddie Mor and Javier Rodriguez allegedly sold counterfeit Serostim to undercover authorities. The Florida Attorney General reports that Lupron and Serostim were diverted from Medicaid and other sources through multiple corportations owned by the defendents.
Serostim is a prescription growth hormone used to treat wasting disease associated with AIDS. Body builders use the drug illegally. A typical prescription is $7,000 to $8,000 for a one-month supply. After Medicaid or private insurance pays for the drugs, dealers often sell them on the street. There have been cases of this all across the country, including New Jersey and California.
In October 2003, owners of L&M Diamond Jewelry Optical were convicted of stealing $2.98 million from Medi-Cal by filing claims for eyeglasses that were lost, stolen or destroyed. They billed for as many as 12 pairs of glasses per year per person. Owner Mila Sigal was sentenced to three years in state prison and ordered to pay $2.88 million in restitution, in addition to $100,000 she had already paid.
The Michigan Attorney General’s Office alleges that pregnant women from Lebanon, Syria and Yemen came to the US to deliver their babies. They applied for Medicaid in Michigan claiming that they intended to remain Michigan citizens (a requirement for obtaining emergency Medicaid coverage). Michigan Medicaid paid for the deliveries, then the women returned to their home countries.
“Fraudsters beware we are on your trail, and will find you and arrest you,” is New York Superintendent of Insurance Gregory V. Serio’s message to criminals.
In August 2003, New York officials busted an auto accident insurance ring involving doctors, dentists, psychiatrists, chiropractors and other health care providers. Fraudsters even setup healthcare clinics as part of the scheme. The scams, which stole $48 million from State Farm Insurance, used “runners” and “crash dummies” to stage over 1,000 accidents. The phony clinics and other medical providers billed the driver’s no fault insurance for services for people supposedly injured in the accidents. In reality, the people were usually not injured and did not receive services.
In June 2003 Hattie and Barry Bull, owners of “H and B Transportation,” pled guilty to overcharging Delaware’s medical assistance program and overstating mileage on patient trips. They were ordered to pay $100,000 in restitution and $12,930 in fees to the Attorney General. They were sentenced to a five year prison term which was suspended for probation.
The New Jersey Office of Insurance Fraud Prosecutor has announced guilty pleas in several pharmacy fraud cases in 2003. New Jersey has clearly made a great effort to crack down on pharmacy fraud in the New Jersey Medicaid program. Cases include fraudulent billing for Serostim, a podiatrist writing fraudulent prescriptions, and an undercover bust.