Boca Raton Medical Supply Company Questioned in Medicare Fraud Billing Investigation By Tod Aronovitz | 05/30/13 | 0 Comment

Boca Raton-based Med-Care Diabetic and Medical Supplies, Inc., and U.S. Healthcare Supply, LLC, based in Milford, N.J., were recently compelled by subpoena to testify before the U.S. Senate Subcommittee on Financial and Contracting Oversight chaired by Sen. Claire McCaskill [D-MO].

Their appearance resulted from a Subcommittee investigation that found more than 60 percent of Medicare payments for durable medical equipment—such as power scooters, back braces, sleep apnea machines and diabetic testing kits—may be unlawful. According to the panel’s investigation, this high rate of error has been estimated to cost Medicare $27 billion in excess payments nationally from 2009 to 2012 with the federal government only being able to recoup about 3 percent of overpayments.

The two companies together have received $168 million in payments from Medicare since 2009, the report said.

At the hearing, Jon Letko, President and CEO of U.S. Healthcare, invoked his Fifth Amendment right and declined to answer questions about aggressive marketing tactics used to sell home medical supplies to Medicare recipients who may not need or want them.  Claims auditors reviewed a sample 6,100 Medicare claims made by the company and found that more than 5,600 of them were improper for a 92 percent error rate.  Applying the same error rate to the rest of U.S. Healthcare’s claims translates to a potential $50 million in overpayments.

On the other hand, Steve Silverman, President of Boca Raton-based Med-Care, answered senators’ questions in the presence of his attorney. The review of Med-Care’s claims showed that in a sample of 590, more than 400 were improper, or a 68 percent rate of error, for a total of $146,689 in overpayments.

If the same error rate is applied to all of Med-Care’s claims, news reports indicate that the company could potentially owe as much as $57 million to the federal government. Silverman acknowledged that incentives are paid to marketing employees based on the number of people called in addition to the number of orders placed, but asserted he and his staff follow all Medicare rules and regulations to the best of their abilities.

This investigation into the medical equipment industry was first prompted when Dr. Charlotte Kennedy, based in Missouri, wrote a letter to the Department of Health and Human Services and Missouri U.S. Sen. Claire McCaskill relaying that U.S. Healthcare and Med-Care had been sending her faxes requesting approval for expensive supplies that she did not request, nor did her patients need. She discovered that her patients were being harassed by telemarketers from these companies.

McCaskill, working through the Senate subcommittee on financial oversight, officially opened a congressional investigation into the sales strategies used by some companies to target senior citizens enrolled in Medicare.

Medical equipment suppliers are prohibited from contacting anyone enrolled in Medicare by telephone unless the patient has given written permission or the supplier has provided equipment to the patient in the past.

How to Report Miami Medicare Fraud

Healthcare or medical billing employees who have inside knowledge of questionable Medicare billing practices can file a confidential legal claim under the False Claims Act. By acting as a “whistleblower” in what is known as a “qui tam” lawsuit, a private party may collect between 10 to 30 percent of the amount recovered, depending on how the case is prosecuted.

ARONOVITZ LAW: Miami Whistleblower / Qui Tam Law Firm

The Miami law firm of ARONOVITZ LAW routinely works with Miami whistleblowers to document Medicare fraud and other forms of fraud against the government. Click on the link to read more about our Miami Whistleblower / Qui Tam law firm services.

Contact Florida whistleblower attorney Tod Aronovitz to discuss a case.