Medicare fraud ring broken
Allegedly worked with companies to send, bill for unwanted braces
WASHINGTON — Federal authorities said on Tuesday they have broken up a $1.2 billion Medicare scam that peddled unneeded orthopedic braces to hundreds of thousands of seniors using foreign call centers. Twenty-four individuals were arrested across the country and 130 companies have been implicated in the scam.
For Glen residents Brenda Forsey and her fiance, Tim Gower, the arrests may make their lives a little smoother. The couple had been inundated with telemarketing calls this past winter trying to sell them medical equipment they did not need or want.
In February, Gower said they had received more than 40 calls since mid-December and some days, as many as a half dozen calls within a very short period of time.
“Everyone has a heavy accent, and [they are] difficult to understand,” said Gower, who said after he told the companies he had reported them to the police, the calls intensified.
Gower said he yelled at one male caller, saying he had notified the sheriff and local newspaper, and the man “just laughed.”
“It became a personal vendetta on his part,” said Gower.
Forsey is totally disabled and is on both Medicare and Medicaid.
But the phone calls were only the beginning for the couple.
Unordered orthopedic braces began showing up at their doorstep.
“They came from all different companies,” said Forsey, adding that the braces were for various parts of the body, none of which she needed or ordered.
She called the companies telling them they had not ordered the braces and representatives for the various companies said they were either non-returnable or she would be charged a return fee.
Forsey returned them anyway.
Then her Medicare account summary arrived and Forsey said she discovered she was charged several times by several different companies for the various braces.
“One was for $171, another $211 and another for $1,574,” said Forsey.
The five companies that charged Forsey’s Medicare in February — Caring For Your Pain Bracing Co., Assured Medical Supply, Ace Medical Supply, Advanced Medical Supply and Westside Medical Bracing — charged Medicare more than $3,700 for the various braces.
When The Leader-Herald called Caring For Your Pain Bracing Co. in February and asked about the equipment being sent to the couple, a customer service representative calling herself Joey V. said no equipment is shipped to anyone “without a prescription from a doctor. That’s our policy.”
Forsey called Medicare and reported to them that she had not ordered the items.
“They told me I had to make copies of all my bills and submit them,” said Forsey. “And they wouldn’t charge my Medicare.”
Other companies listed on the equipment or its paperwork as possible manufacturers or distributors were Comfortland Medical of Mebane, N.C., Affordable Care Consultants; Helpful Home; Aspen Evergreen Back Brace and Danco/Doctors Medical of Longwood, Fla.
The DOJ said in the news release the scheme involved 130 DME companies that submitted more than $1.7 billion in claims. The DOJ has not responded for requests by press time if any of the companies that sent Forsey the braces are involved and the DOJ did not list the companies individually in its release.
“One of the largest health care fraud schemes investigated by the FBI and the U.S. Department of Health and Human Services Office of the Inspector General and prosecuted by the Department of Justice resulted in charges against 24 defendants, including the CEOs, COOs and others associated with five telemedicine companies, the owners of dozens of durable medical equipment 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 news release stated.
“The charges announced [Tuesday] 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,” the release stated.
The call centers were located in Latin America and the Philippines.
The release further stated that the people charged in the scheme allegedly paid doctors to prescribe DME either without any patient interaction or with only a brief telephone conversation with patients they had never met or seen. The money the people made was then allegedly laundered through international shell corporations and used to purchase exotic automobiles, yachts and luxury real estate in the United States and abroad.
Those arrested include:
In New Jersey, Creaghan Harry, 51, of Highland Beach, Fla.; Lester Stockett, 51, of Deerfield Beach, Fla.; and Elliot Loewenstern, 56, of Boca Raton, Fla.; the owner, CEO and vice president of marketing of purported call centers and telemedicine companies, for their alleged participation in a $454 million illegal health care kickback and international money laundering scheme. In addition, Dr. Joseph DeCoroso, 62, of Toms River, N.J., was charged in an alleged $13 million conspiracy to commit health care fraud and separate charges of health care fraud for writing medically unnecessary orders for DME, in many instances allegedly without ever speaking to the patients, while working for two telemedicine companies.
Charges were also brought against Neal Williamsky 59, of Marlboro, N.J., and Nadia Levit, 39, of Englishtown, N. J., owners of approximately 25 DME companies, for their alleged participation in a $150 million scheme related to the payment of kickbacks and bribes in exchange for medically unnecessary DME orders. Albert Davydov, 26, of Rego Park, N.Y., was also charged for his alleged participation in a $35 million scheme related to the payment of kickbacks and bribes in exchange for medically unnecessary DME orders.
In Florida, charges were brought against Willie McNeal, 42, of Spring Hill, Fla., the owner and CEO of two purported telemedicine companies, for his alleged participation in a $250 million scheme related to the solicitation of illegal kickbacks and bribes in exchange for the referral of DME orders to DME providers.
In Texas, charges were brought against Leah Hagen, 48, and Michael Hagen, 51, of Dalworthington Gardens, Texas, owners and operators of two DME companies, for their alleged participation in a $17 million illegal health care kickback scheme related to the payment of kickbacks in exchange for the referral of medically unnecessary DME orders and Christopher O’Hara, 54, of Kingsbury, Texas, the owner of a purported telemedicine company, was charged in an $40 million scheme of DME orders.
In Pennsylvania, Dr. Randy Swackhammer, 60, of Goldsboro, North Carolina, was charged for an alleged $5 million conspiracy to commit health care fraud that involved writing medically unnecessary orders for DME while working for a telemedicine company, in many instances with only a brief telephone conversation with the patients.
In South Carolina, charges were brought against Andrew Chmiel, 43, of Mt. Pleasant, South Carolina, owner of over a dozen companies involved in the scheme, for his alleged participation in a $200 million scheme related to the payment of kickbacks and bribes in exchange for medically unnecessary DME orders.
In addition, search and seizure warrants were being executed Tuesday at 20 different business locations, including numerous DME companies and a fraudulent telemarketing company. The search and seizures were executed by over 100 law-enforcement officers from six federal agencies. In addition to the 20 search warrants, millions of dollars and other assets tied to the conspiracy were seized and/or frozen.
For Forsey and Gowen, for now the calls seemed to have stopped and the braces are no longer arriving.
“I’m glad,” said Forsey.
Eric Retzlaff and The Associated Press contributed to this story.