Medical Equipment Fraud Attorney

The Durability of Medical Equipment Fraud

Think of Medicare or Medicaid fraud, and your first thought is not likely to be of wheelchairs or portable oxygen tanks. Durable medical equipment fraud (DME) can be a less-obvious kind of wrongdoing when it comes to the False Claims Act’s (FCA) provisions. But it isn’t as uncommon as you might think: the General Accounting Office reported that, in 2010, about 16 percent of all FCA fraud cases—basically, one in six—involved DME suppliers. And whistleblowers have brought their share of qui tam suits when it comes to DME false claims.

According to the US Office of Management and Budget, improper payments under Medicaid alone in fiscal year 2015 amounted to $29.15 billion. DME fraud certainly totals in the billions: it is estimated to range from $1.5 billion to $5 billion each year.

How Do We Define Durable Medical Equipment?

Durable medical equipment is generally an item providing therapeutic benefits that can bear up under repeated usage. Such items are generally not useful to a person unless they are injured or sick, are commonly used at home, are generally ordered or prescribed by a doctor, and are required for daily activities.

Thus, a wheelchair and oxygen equipment are examples of durable medical equipment, while a one-time-use bandage or other disposable items are not.

For a DME order to be covered by Medicaid or Medicare, the doctor must order the equipment using a Certificate of Medical Necessity (CMN). This form is then sent to a supplier who processes the order and then files a claim for payment with the government.

What is DME Fraud?

Medical equipment fraud can involve many aspects of false claims, including failure to report adverse medical effects to the FDA (usually with implantable medical devices), and stealing identities for the purposes of submitting false claims. Here are some of the more common ways that durable medical equipment fraud is committed:

• Billing for DME that is medically unnecessary.
• Billing for DME that was not ordered by the treating physician. This can involve forging signatures of doctors.
• Billing for DME that was never provided to patients. This can be accompanied by identity theft, meaning submitting claims under “borrowed” or stolen Social Security numbers.
• Billing for maintenance of DME that was never performed.
• Billing for a more expensive class of DME than was provided to patients (upcoding).
• Billing for DME for patients who do not qualify for the equipment.
• Not crediting Medicare/Medicaid/etc. for DME returned by the patient.
• Providing defective equipment.
• Paying kickbacks to gain referrals for DME.
• Engaging in any improper financial arrangement with referring doctors. This can include violations of the Stark Law, if the doctor has a financial interest in the DME supplier or manufacturer.

Any time these actions result in false payments extracted from government health care programs, prosecution can occur under the FCA.

Successful Whistleblower DME Fraud Cases

A number of recent successful qui tam cases involving DME illustrate the various kinds of durable medical equipment fraud that can be brought down by whistleblowers:

• May, 2015: Orbit Medical Inc. and Rehab Medical Inc. were ordered to pay $7.5 million because of allegations from two whistleblowers that false claims for power wheelchairs and related items were submitted to federal health care programs. The whistleblowers were awarded $1.5 million.
• December, 2015: Dynasplint Systems Inc. and its founder agreed to resolve allegations they improperly billed Medicare for splints provided in skilled nursing facilities by paying $10.3 million. The whistleblower is supposed to receive at least $1.98 million.
• March, 2016: Respironics Inc. agreed resolve alleged FCA violations concerning payment of kickbacks by paying $34.8 million. The kickbacks involved free call center services to DME suppliers who bought masks from Respironics for sleep apnea patients. The whistleblower was awarded $5.38 million.

In an older case from 2011, Hill-Rom Company agreed to pay $41.8 million to settle charges that it submitted eight years’ worth of false claims for DME. The whistleblowers, all either current or former sales representatives for Hill-Rom, were awarded almost $8 million.

What If I’ve Seen DME Fraud?

If you think you can document durable medical equipment fraud that could be prosecuted under the FCA’s provisions, and you are willing to become a whistleblower, selecting the right attorney is crucial. Complex procedures must be followed to the letter in order for your case to succeed, and you must have actionable information. This often, but not always, means that you are employed by:

• A physician or medical facility that cares for Medicare, Medicaid, or other federal health care program patients
• The DME industry
• A company that has dealings with the DME industry.

The award that a whistleblower receives is usually between 15 and 30 percent of the recovered amount.

If you do not have information that could be used in a whistleblower suit, but you see charges for DME on a Medicare Summary Notice, or you receive an unsolicited call to buy such equipment, report such instances to Medicare by calling 1-800-MEDICARE. If you have private insurance, contact your insurance company’s anti-fraud department.

Working with whistleblowers tenaciously to shed light on fraudulent practices.

If you think you have the facts needed to bring a whistleblower case, the experienced whistleblower attorneys at the Louthian Law Firm can review your case and help you file the appropriate disclosure statement. Under some circumstances, the government will intervene, or join in your lawsuit.

Your chances of succeeding are greater if your whistleblower claim is substantive, clear, and to the point. Because of this, meeting with a qualified whistleblower attorney can increase your chances of winning. The Louthian Law Firm can help you form your claim so that the government will be more inclined to intervene in your case; government intervention can sometimes increase the chances of recovering reward money. Even if the government decides not to intervene, it could still be a good idea to pursue your case without government involvement. Our strong support system can assist you through every step of the process.

For a free, confidential evaluation of your case, call the Louthian Law Firm today at 1-803-454-1200 or, if you prefer, you can fill out our online contact form.