Feds crack down on Houston wheelchair scam

Monday, August 18, 2003

August 19 , 2003

HOUSTON - For more than a year, medical equipment companies have been combing senior centers across the state and into Louisiana, bringing people to Houston by the bus load for wheelchairs they often don't need, the Houston Chronicle reported Sunday.

Only one person has been charged so far, but more indictments are expected this fall. Using a federal fraud statute, authorities have quietly frozen more than $7 million in the bank accounts of those under investigation, the Chronicle reported.

In June, HME News reported that HME providers in Houston were growing increasingly frustrated with a rash of new power mobility dealers and the second-tier manufacturers serving them.

Providers contacted by HME News said the dealers in question belong to a particular ethnic group and are practicing the kind of business that tarnishes the reputation of the HME industry and is drawing the attention of FBI and OIG investigators.

The questionable business protocols involve dealers who are reportedly ferrying Medicare beneficiaries to doctors’ offices to get signed off on the need for power mobility equipment, HME News reported. The scams involve ‘substitutions,’ in which a dealer will sell a Medicare beneficiary on a K0011 power wheelchair, bill for that, but deliver a scooter.

According to the Chronicle, the scam works like this: "Recruiters" get a fee for bringing people in, according to the documents. In some cases, doctors get a kickback for signing a "certificate of medical necessity" after a brief checkup. Medicare gets billed more than $5,000 for a motorized wheelchair, even though a less-expensive scooter is often delivered and frequently isn't even needed.

Although federal authorities are now cracking down, the scam has spread like wildfire, they said. In 2000, Medicare paid $49 million for motorized wheelchairs across Texas. Last year, the figure had more than tripled to $168 million.

"The harder we look, the more we see. The proportions are tremendous," said Michael Shelby, U.S. attorney for the Southern District of Texas, told the Chronicle.