By Victoria Knight OCTOBER 9,
2019
Dean
Ernest had been living in a nursing home about a year when his son, John, got a
call last winter asking if his father was experiencing back pain and would like
a free orthotic brace.
The
caller said he was with Medicare. John Ernest didn’t believe him, said “no” to
the brace and hung up. He didn’t give out his father’s Medicare number.
And
yet, not just one, but 13 braces arrived soon afterward at Ernest’s house in
central Pennsylvania.
Medicare,
the federal taxpayer-supported health care insurance program for older
Americans, had paid over $4,000 for 10 of the braces: a back brace, two knee
braces, two arm braces, two suspension sleeves, an ankle brace, a wrist brace
and a heel stabilizer.
The
orders came from four medical equipment companies and were prescribed by four
separate health care professionals — a prescription being required to receive
an orthotic brace. But Ernest said he didn’t talk to any doctors during the
phone call.
That’s
how the latest Medicare frauds work, said Ariel Rabinovic, who works with
Pennsylvania’s Center for Advocacy for the Rights & Interests of the
Elderly. He helped report Ernest’s fraud case to authorities at Medicare.
Rabinovic said the fraudsters enlist health professionals — doctors, physician
assistants, nurse practitioners — to contact people they’ve never met by
telephone or video chat under the guise of a telemedicine consultation.
“Sometimes
the teledoctors will come on the line and ask real Mickey Mouse questions,
stuff like, “Do you have any pain?” explained Rabinovic. “But oftentimes, there
is no contact between the doctor and the patient before they get the braces.
And in almost all of the cases, the person prescribing the braces is somebody
the Medicare beneficiaries don’t know.”
While
prescriptions for durable medical equipment, such as orthotic braces or
wheelchairs, have long been a staple of Medicare fraud schemes, the
manipulation of telemedicine is relatively new. The practice appears to be
increasing as the telemedicine industry grows.
“This
has put telemedicine scams on Medicare’s radar with growing urgency,” said
James Quiggle, director of communications for the Coalition Against Insurance
Fraud.
In the
past year, the Department of Health and Human Services Office of Inspector
General, the Department of Justice and, in some cases, the FBI, have busted at
least five health care fraud schemes that involved telemedicine. Typically in
these schemes, scammers use sham telemedicine companies to scale up their
operations quickly and cheaply — they can have a couple of doctors remotely
writing a large number of prescriptions.
Often
the doctors working for these outfits don’t perform medical consultations, but
rather write prescriptions without talking to patients, as in Ernest’s case. Of
course, that is not how telemedicine is designed to work.
In
April 2019, the DOJ announced investigators had disrupted what they
called “one of the largest Medicare fraud
schemes in U.S. history.” Operation Brace Yourself cracked an
international scheme allegedly defrauding Medicare of more than $1.2 billion by
using telemedicine doctors to prescribe unnecessary back, shoulder, wrist and
knee braces to beneficiaries.
The DOJ
charged 24 people, including three medical professionals and the corporate
executives of five telemedicine companies.
According
to federal court documents, Willie McNeal of Spring Hill, Fla., owned two of
the “purported” telemedicine companies, WebDoctors Plus and Integrated Support
Plus.
Federal
investigators allege that through Integrated Support Plus, McNeal hired and
paid a New Jersey doctor, Joseph DeCorso, to write prescriptions for braces.
DeCorso recently pleaded guilty to
one count of conspiracy to commit health care fraud.
DeCorso
admitted to writing medically unnecessary brace orders for telemedicine
companies without speaking to beneficiaries or doing physical exams. He also
admitted that his conduct resulted in a $13 million loss to Medicare. He has
agreed to pay over $7 million in restitution to the federal government.
McNeal
got the Medicare beneficiaries’ information for DeCorso to write the
prescriptions from telemarketing companies, according to the indictment. Then,
authorities allege, McNeal sent the prescriptions back to the same
telemarketing companies in exchange for payments described as kickbacks and
bribes.
Federal
investigators allege these telemarketing companies sold the prescriptions to
the durable medical equipment companies, who in turn billed Medicare for the
braces.
McNeal’s
lawyer said he could not discuss his client’s case because it is pending.
DeCorso’s lawyer did not respond to multiple requests for comment.
The
U.S. attorneys allege the money made from the scheme was hidden through
international shell corporations and used to buy luxury real estate, exotic
automobiles and yachts.
It’s
clearly a profitable business. Taxpayers are the ones who ultimately pay for
Medicare fraud, which often leads to higher health care premiums and
out-of-pocket costs.
Medicare
spending on back, knee and ankle braces highlighted in the inspector general’s
investigations increased by over $200 million from 2013 to
2017, according to an analysis of Medicare data by Kaiser Health News. While
the number of Medicare fee-for-service beneficiaries increased slightly, by 5%,
from 2013 to 2017, spending on the three types of braces increased by 51%
during that same period.
In
an April news release about
Operation Brace Yourself, Assistant Attorney General Brian Benczkowski of the
DOJ’s Criminal Division called the Medicare scheme “an expansive and
sophisticated fraud to exploit telemedicine technology meant for patients
otherwise unable to access health care.”
Nathaniel
Lacktman, a lawyer who represents telemedicine companies and organizations, was
quick to point out that the industry does not recognize the fraudsters involved
in these schemes as legitimate businesses.
“These
are actually really sketchy online marketing companies participating in these
schemes who are billing themselves as telemedicine,” said Lacktman, who works
in the Tampa office of the law firm Foley & Lardner. “But in fact, they’re
companies we’ve never heard of.”
All of
this comes at a time when Medicare and Medicare Advantage are expanding telemedicine,
though the programs have been slower to adopt it than the private sector, said
Laura Laemmle-Weidenfeld, a health care lawyer at the law firm Jones Day.
“I
would hate for Medicare to fall even further behind with telehealth,” said
Laemmle-Weidenfeld, who previously worked in the Fraud Section of the DOJ’s
Civil Division. “The vast majority of telehealth providers are legitimate, but
as with anything there are a few bad apples,” she said.
Even
with the recent federal busts, the scams continue.
Travis
Trumitch, who works for the Illinois nonprofit AgeOptions, which helps report
Medicare fraud in the state, said he received three voicemails over a recent
weekend reporting suspected durable medical equipment scams.
John
Ernest said he still receives calls every day with individuals on the line who
say they work for Medicare and ask for Dean Ernest’s information — though his
father died in April.
But
Ernest can’t change his phone number because it’s the main line associated with
his painting business.
“It
really drives me crazy,” said Ernest. “How many people are they ripping off?”
KHN
data editor Elizabeth Lucas contributed to this report.
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