Health Law Matters

DOJ Brings Charges in Another Massive Medicare Fraud Scheme

The Week in Health Law

  • The U.S. Department of Justice (“DOJ”) issued a press release announcing charges against 24 defendants associated with companies that pushed unneeded braces on Medicare beneficiaries, which resulted in a loss to the Medicare program of over one billion dollars.
  • The scam relied on telemarketers in the Philippines and Latin America who sought out elderly Medicare patients. Using television and radio ads and telephone calls, the companies promised a “free or low-cost” orthotic brace for a patient’s back, shoulder, wrist, or knee.
  • Once a company had a person’s insurance information, the company would bill Medicare and mail out the braces.It was alleged the companies provided kickbacks to doctors who wrote prescriptions for the braces after having only brief telephone conversations with patients they had never seen.
  • Federal officials said the scheme was one of the largest ever, involving more than 80 search warrants in 17 federal districts. DOJ said the illegal profits were laundered through international shell companies to buy exotic cars, yachts, and luxury real estate.
  • Associated with this case, the Centers for Medicare and Medicaid Services (“CMS”) also announced it was taking administrative action against 130 durable medical equipment companies, which were paid over $900 million for various braces.

More trending Health Law topics this week:

  • CMS Proposal Will Expand Coverage of Blood Pressure Monitoring

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Brian F. Higgins is an associate in FBT's regulated business group with a focus on health care, and he has a history as corporate counsel to Medpace, Inc., a pharmaceutical clinical research organization.