Home Health Care Feds bust alleged $1.2 billion telemedicine Medicare fraud scheme

Feds bust alleged $1.2 billion telemedicine Medicare fraud scheme


The Justice Department announced charges against 24 people who were allegedly involved in a complex $1.2 billion fraud scheme to sell medically unnecessary orthopedic braces to Medicare beneficiaries.

Suspects in the case include executives at five telemedicine companies, the owners of dozens of durable medical equipment (DME) companies and three licensed medical professionals.

Among the telemedicine companies allegedly involved in the scheme were Video Doctor USA, AffordADoc, Web Doctors Plus, Integrated Support Plus and First Care MD.

“These defendants — who range from corporate executives to medical professionals — allegedly participated in an expansive and sophisticated fraud to exploit telemedicine technology meant for patients otherwise unable to access health care,” Assistant Attorney General Brian Benczkowski said in a statement.

“This Department of Justice will not tolerate medical professionals and executives who look to line their pockets by cheating our health care programs.”

According to the DOJ, the implicated companies paid illegal kickbacks and bribes to clinicians working with fraudulent telemedicine companies to refer Medicare patients who were then sold unnecessary back, shoulder, wrist and knee braces.

Here’s how investigators said the scheme worked. Medicare beneficiaries were targeted by ads or telemarketers operating out of call centers in the Philippines and Latin America and offered “free or low-cost” braces, regardless of medical necessity.

These patients were then routed to telemedicine companies who were bribed by the telemarketer call centers, and who in turn paid doctors to prescribe unnecessary orthopedic braces to patients they had never met or often had no contact with. The call centers would then sell these orders to DME companies who would bill Medicare for their cost.

Investigators said hundreds of thousands of elderly or disabled patients were lured in by the scheme and that proceeds from the fraud were laundered through international shell corporations and used to purchase luxury cars, boats and real estate.

The Center for Medicare Services, Center for Program Integrity is also taking additional action against 130 medical equipment companies implicated in billing Medicare a total of $1.7 billion, of which more than $900 million was paid out.

The government’s investigation spanned 17 federal districts and involved multiple federal agencies including the FBI, the U.S. Department of Health and Human Services Office of the Inspector General and the IRS.

“The breadth of this nationwide conspiracy should be frightening to all who rely on some form of healthcare,” IRS Criminal Investigations Chief Don Fort said in a statement.

“The conspiracy described in this indictment was not perpetrated by one individual. Rather, it details broad corruption, massive amounts of greed, and systemic flaws in our healthcare system that were exploited by the defendants.”

Picture: AndreyPopov, Getty Images

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