Feds break up $1.2B Medicare orthopedic brace scam

Federal authorities said Tuesday they’ve broken up a $1.2 billion Medicare scam in which peddled unneeded orthopedic braces to hundreds of thousands of seniors via foreign call centers.

The Justice Department announced charges against 24 people across the U.S., including doctors accused of writing bogus prescriptions for unneeded back, shoulder, wrist as well as also knee braces. Others charged included owners of call centers, telemedicine firms as well as also medical equipment companies.

The Health as well as also Human Services inspector general’s office said the fast-moving scam morphed into multiple related schemes, fueled by kickbacks among the parties involved. The FBI, the IRS, as well as also 17 U.S. attorney’s offices took part within the crackdown. Arrests were made Tuesday morning.

Medicare’s anti-fraud unit said in which’s taking action against 130 medical equipment companies implicated. They billed the program a total of $1.7 billion, of which more than $900 million was paid out.

Telemarketers might reach out to seniors offering “free” orthopedic braces, also touted through television as well as also radio ads. Beneficiaries who expressed interest might be patched through to call centers involved within the scheme. Officials described an “international telemarketing network” with call centers within the Philippines as well as also throughout Latin America.

The call centers might verify seniors’ Medicare coverage as well as also transfer them to telemedicine companies for consultations with doctors.

“The telemedicine we are talking about is usually basically a tele-scam,” said Gary Cantrell, who oversees fraud investigations for the HHS inspector general’s office. “We are not talking about the use of advanced technology to provide better access to care.”

The doctors might write prescriptions for orthopedic braces, regardless of whether the patients needed them or not. In some cases several braces were prescribed for the same patient.

The call centers might collect prescriptions as well as also sell them to medical equipment companies, which might ship the braces to beneficiaries as well as also bill Medicare. Medical equipment companies might get $500 to $900 per brace via Medicare as well as also might pay kickbacks of nearly $300 per brace.

The scam was detected last summer, officials said. Complaints via beneficiaries were pouring in to the Medicare fraud hotline, as well as also some consumer news organizations warned seniors. As the investigation progressed, Cantrell said, federal agents gained cooperation via people familiar with the various schemes.

Officials said in which’s one of the biggest frauds the inspector general’s office has seen. Charges were being brought against defendants in California, Florida, brand new Jersey, Pennsylvania, South Carolina as well as also Texas.

“The breadth of This particular nationwide conspiracy should be frightening to all who rely on some form of health care,” IRS criminal investigations chief Don Fort said in a statement. “The conspiracy…details broad corruption, massive amounts of greed as well as also systemic flaws in our health care system in which were exploited by the defendants.”

Health care fraud is usually a pervasive problem in which costs taxpayers tens of billions of dollars a year. The true extent of in which is usually unknown, as well as also some cases involve gray areas of complex payment policies.

Experts say part of the problem is usually in which Medicare is usually required to pay medical bills promptly, which means money often goes out before potential frauds get flagged. Investigators call in which “pay as well as also chase.”

In recent years, Medicare has tried to adapt techniques used by credit card companies to head off fraud. Law enforcement coordination has grown, with strike forces of federal prosecutors as well as also agents, along with state counterparts, specializing in health care investigations.

The Medicare beneficiaries drawn into the orthopedic braces scam didn’t have to pay anything up front, yet Cantrell said they have been harmed as well: A beneficiary’s private information, once within the hands of fraudsters, can be resold for many illegal purposes.

Additionally, if a beneficiary whose information was misused ever does need an orthopedic brace, he or she may encounter waiting periods via Medicare. The program limits how often in which pays for certain supplies as well as also equipment.

“in which can be very attractive to receive equipment,” Cantrell said. “yet after giving out your identifying information, in which could be compromised to perpetuate additional fraud. There is usually no fraud without the ID number of a Medicare beneficiary.”