Married Telehealth Co-Owners Charged in $56 Million Kickback Scheme
Friday, May 15, 2020
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law
On February 5, 2020, the owners of two telemedicine companies were charged in New Jersey federal court with defrauding Medicare in an alleged $56 million telehealth scheme involving orthotic braces. Some of the fraud alleged to have occurred was through a Florida location. The married co-owners of Advantage Choice Care and Tele Medicare are reported to have used the companies to solicit kickbacks and bribes from patient recruiters, pharmacies, and brace suppliers. The company would then hire providers to order medically unnecessary braces which were billed to Medicare, according to the U.S. Department of Justice (DOJ).
The scheme allegedly took place from March 2017 to April 2019.
Phony Contracts to Hide Illegal Kickbacks.
The fraud scheme allegedly was able to evade detection by the U.S. Department of Health and Human Services (HHS) by using sham contracts that labeled the kickbacks as "consultations" and "medical expenditures," the government said. The illegal payments, some as much as $34,910, were all made through bank accounts that indirectly funneled cash into Advantage Choice Care.
Authorities say the pair and others transferred the brace orders to co-conspirator suppliers to support more than $56 million in false and fraudulent claims to Medicare that were submitted by brace suppliers. According to court documents, Medicare paid these brace suppliers over $28 million for these claims.
The husband and wife were arrested and charged with six counts, according to the indictment. They were charged with one count of conspiracy to defraud the United States and to pay and receive health care kickbacks, one count of conspiracy to commit health care fraud and wire fraud, three counts of receiving health care kickbacks, and one count of conspiracy to commit money laundering. These charges are standard for most fraud prosecutions in federal court. Click here to view the indictment in full.
The couple owned and operated two telehealth companies which had locations in Bayonne, New Jersey, Boca Raton, Florida, and Richmond Hill, Georgia. To view the DOJ's press release on this case, click here.
Click here to read one of my prior blogs to learn more about Telemedicine in Florida.
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"Telemedicine co. owners charged in $56 million Medicare fraud case." Modern Healthcare. (February 5, 2020). Web.
Stawicki, Kevin. "Telemedicine Execs Charged In $56M Medicare Fraud Scheme." Law360. (February 5, 2020).
About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave. Suite 1000, Altamonte Springs, FL 32714, Phone: (407) 331-6620.
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