Government announces $12M Medicare fraud settlement

Wednesday, October 23, 2013

NEW ORLEANS – Robert Shea and Mark Franz, owners of a pair of Kansas-based diabetic supply companies, will pay the government $7 million to settle allegations of fraud, U.S. Attorney Kenneth Allen Polite, Jr., announced Oct. 22. Federal prosecutors charged the pair and their businesses submitted false claims to Medicare and to Louisiana’s Tricare program. Global Medical, Inc. and parent company Global Medical Direct, LLC will pay $5 million from the proceeds of the sale of their assets; the combined $12 million in penalties will resolve civil and criminal liability in the matter. The government alleges Shea and Franz entered the companies into contracts with insurance brokerages and other companies between 2008 and 2012, paying those companies based on the number of patients referred for diabetic supplies.