Today, the Department of Justice announced charges against 24 defendants, including the CEOs, COOs and others associated with five telemedicine companies in connection with telemedicine fraud. Additional charges were announced against the owners of dozens of durable medical equipment (DME) companies and three licensed medical professionals, for their alleged participation in health care fraud schemes involving more than $1.2 billion in loss, as well as the execution of over 80 search warrants in 17 federal districts.
The arrests were coordinated by the Health Care Fraud Unit of the Criminal Division’s Fraud Section in conjunction with its Medicare Fraud Strike Force (MFSF), as well as the U.S. Attorney’s Offices for the Districts of South Carolina, New Jersey and the Middle District of Florida. The MFSF is a partnership among the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, IRS-CI and other federal law enforcement agencies participated in the operation.
The charges announced today target an alleged scheme involving the payment of illegal kickbacks and bribes by DME companies in exchange for the referral of Medicare beneficiaries by medical professionals working with fraudulent telemedicine companies for back, shoulder, wrist and knee braces that are medically unnecessary. Some of the defendants allegedly controlled an international telemarketing network that lured over hundreds of thousands of elderly and/or disabled patients into a criminal scheme that crossed borders, involving call centers in the Philippines and throughout Latin America. Telemedicine fraud has been a recent priority of the government. In many instances, telemedicine fraud is one piece of a compensation arrangement, that the government professes, also involves kickbacks.
In the takedowns today, the government alleged that the defendants paid doctors to prescribe DME either without any patient interaction or with only a brief telephonic conversation with patients they had never met or seen. The proceeds of the fraudulent scheme were then allegedly laundered through international shell corporations and used to purchase exotic automobiles, yachts and luxury real estate in the United States and abroad. Notably, the defendants in the takedown range from corporate executives to medical professionals. The Government alleges, however, that they used expensive telemedicine platforms to exploit patient access to care by among other things using an international call center that advertised to Medicare beneficiaries and “up-sold” the beneficiaries to get them to accept numerous “free or low-cost” DME braces. According to DOJ, the international call center allegedly paid illegal kickbacks and bribes to telemedicine companies to obtain DME orders for these Medicare beneficiaries. The telemedicine companies then allegedly paid physicians to write medically unnecessary DME orders. Finally, the international call center sold the DME orders that it obtained from the telemedicine companies to DME companies, which fraudulently billed Medicare. Collectively, the CEOs, COOs, executives, business owners and medical professionals involved in the conspiracy are accused of causing over $1 billion in loss.
The Firm has significant experience in health care fraud and kickback investigations including investigations involving alleged telemedicine fraud.
Author: Andrew Feldman
Mr. Feldman represents professionals, corporations, health care providers, and health care marketers in government investigations and prosecutions throughout the United States. Mr. Feldman works tirelessly for his clients from the time an investigation begins until the time a jury renders a verdict.
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