Palmetto pays an arm and a leg -- 21,000 times

Sunday, May 15, 2005

MIAMI -- A federal judge in Miami can't understand why Palmetto GBA, the Region C DMERC that processed millions of dollars of power wheelchair claims for fraudulent providers in Houston, recently paid $122 million for artificial arms and legs in Miami-Dade County.

"It is unclear why Palmetto GBA is not the subject of the government's investigation into criminal wrongdoing," U.S. District Judge Cecilia M. Altonaga wrote in a decision quoted by the Miami Herald on May 10.

Palmetto defended itself against the criticism by noting how little money the federal government dedicates to fighting fraud. The agency also said it helped prosecutors detect the problem and put a stop to it in four months.

"Catching this kind of behavior at four months is early," Palmetto spokesperson Elizabeth Hammond told the Miami Herald.

Federal prosecutors investigated and filed a civil lawsuit against 48 small companies and a billing agency that submitted the 21,000 claims.

In April 2004, a Government Accountability Office (GAO) report questioned the expenditure of hundreds of millions of dollars for expensive power wheelchairs. Palmetto GBA paid two-thirds of those claims, many of them to operators in Houston, Texas.