Squeaky Wheels

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Senior Man in Wheelchair looking out of a window in a hospital corridor.

For people with serious mobility problems, a powered wheelchair can mean the difference between being homebound or having an active lifestyle. But with the price tag for one around thousands of dollars, most people are at the mercy of insurance to pick up the tab. That’s why federal prosecutors take it seriously when people defraud public insurance programs.

In one recent Medicare fraud case, three people working for two Southern California-based medical equipment companies have been caught up in a fraud scheme that the government says involved billing the healthcare program for more than $24 million for medically unnecessary power wheelchairs and repairs.

The 45-year-old office manager for both businesses, in Hawthorne and Ventura, pleaded guilty last month to two federal counts of making false statements affecting a healthcare program. The general manager of both businesses and a repair technician were also charged.

According to the government’s case, the general manager “orchestrated a scheme in which corrupt physicians prescribed medically unnecessary durable medical equipment, such as power wheelchairs, and oversaw the submission of bogus bills to Medicare.” (It’s good of doctors to accommodate patients – except when they do so with expensive and unnecessary equipment paid for by taxpayers.)

The 49-year-old Redondo Beach woman is scheduled to go to trial in April. The repair technician pleaded guilty to conspiracy to launder money and is scheduled for sentencing in March.

Apparently, one or all of those charged with Medicare fraud were strategic about how to bill the government healthcare program. When Medicare changed the reimbursement rules for wheelchairs, the businesses largely stopped billing for the chairs and, instead, started billing Medicare for repairs, prosecutors said. (Fraudsters will steal government benefits one way or another.)

The Southern California-based businesses allegedly submitted bills for repair or replacement services that were not medically necessary, were not needed to make the wheelchairs serviceable and often, or simply were not performed. (Why perform unnecessary work? This further supports the theory that fraudsters are just plain lazy.) According to the indictment, the majority of bills submitted in the Medicare fraud case involve fraudulent repair work.

Today’s “Fraud of the Day” comes from the article, “Paramount Woman Pleads Guilty in $24 million Healthcare Fraud Scheme,” published Dec. 19, 2019 in MynewsLA.com.

A Paramount woman pleaded guilty Thursday to her role in a healthcare fraud scheme that prosecutors suspect billed Medicare well over $24 million for medically unnecessary power wheelchairs and the repair of medical equipment.

Cynthia Karina Marquez, 45, entered her plea to two federal counts of making false statements affecting a healthcare program. U.S. District Judge Fernando M. Olguin set an April 9 sentencing hearing in downtown Los Angeles.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.