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Government looks into Medicare fraud by medical device companies

On behalf of Jeffrey Rabin of Jeffrey A. Rabin & Associates, Ltd. posted in SSA on Friday, May 24, 2013.

Residents here in Illinois have probably heard about Medicare fraud at least once in their lives. And while most people assume that it’s the beneficiaries of benefits that are abusing the system, a new investigation, conducted by the Senate Subcommittee on Financial and Contracting Oversight, may have discovered where the real fraud is being committed.

The alleged fraud was first brought to the subcommittee’s attention after receiving a letter from a Missouri doctor who suspected that some medical device companies were trying to receive Medicare compensation by selling expensive equipment to patients who did not request or need the devices. The subcommittee quickly discovered that there were more cases nationwide just like this one.

Several medical supply companies were accused of harassing Medicare patients by cold calling them and persuading them to buy medical supplies they did not need. According to the subcommittee, this practice of cold-calling is simply prohibited by law.

It’s estimated that Medicare paid out nearly $27 billion over the past few years for unnecessary equipment and supplies. An alarming number when one considers the dire straight the Medicare and Medicaid programs are in at this very moment.

Fraud such as this doesn’t just hurt the Medicare system but the entire Social Security system as well. A certain level of mistrust begins to brew which can severely hurt the people who rely on these systems to stay financially stable.

One of the medical equipment companies currently being investigated by the Senate subcommittee has invoked its Fifth Amendment right and has declined to answer any questions surrounding the alleged fraud. But according to reports, they have been issued a subpoena to appear before the Senate panel and may be required to answer the questions then.

Source: The Tri-City Herald, “Medical company declines to answer Senate questions on Medicare billing,” Lindsay Wise, May 22, 2013

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