DOJ Charges Two Florida Men in $34.8M Medicare Fraud Scheme Targeting Beneficiaries

by Sydney D. Finlay and Cameron Smith

Two Florida men have been charged in a $34.8 million Medicare fraud scheme that exploited vulnerable beneficiaries and billed for medically unnecessary services. The case is part of the Department of Justice’s (“DOJ”) intensified efforts to combat healthcare fraud — an area where Miller Shah LLP actively represents whistleblowers under the False Claims Act (“FCA”).

Key Allegations in this $34.8 Million Medicare Fraud Scheme

The indictment reveals that two Florida men were charged for their alleged roles in a scheme to submit approximately $34.8 million in false and fraudulent claims to Medicare for medically unnecessary products. Kenneth Kessler III and Michael Gomez are charged in connection with their ownership and operation of seven durable medical equipment (“DME”) companies. The companies are alleged to have submitted false claims for orthotic braces, glucose monitors, and other medically unnecessary equipment.

Prosecutors allege that the pair knowingly paid illegal kickbacks and bribes to marketing companies that used deceptive and aggressive telemarketing tactics on thousands of Medicare beneficiaries. Marketing companies used these deceptive tactics to obtain the beneficiaries’ personally identifiable information and arranged for telemedicine companies to generate doctors’ orders using the beneficiaries’ information.  Kessler and Gomez proceeded to use those doctors’ orders to submit false and fraudulent claims to Medicare through their network of DME companies.

Medicare Beneficiaries Targeted and Exploited in Healthcare Fraud

Kessler and Gomez are alleged to be the drivers of the scheme by paying illegal kickbacks to marketing companies, who obtained Medicare beneficiaries’ information and arranged for the creation of doctors’ orders for medically unnecessary equipment.   T Through their DME companies, Kessler and Gomez used these doctors’ orders to submit false claims for reimbursement to Medicare.

A Medicare beneficiary is an individual who is enrolled in Medicare and entitled to receive Medicare benefits. A Medicare beneficiary includes but is not limited to those aged 65 or older, individuals with certain disabilities or conditions, and those who are defined as low income according to federal guidelines. According to the indictment, telemarketing companies shared beneficiaries’ sensitive information and exploited patients who may not otherwise be able to afford healthcare. In this case, many beneficiaries received equipment that is not necessary and could potentially cause more damage than good. The DOJ is cracking down on healthcare fraud and is making it clear that they will work tirelessly to protect the integrity of federal programs.

DOJ Continues to Crack Down on Healthcare fraud

Kessler and Gomez are both charged with conspiracy to commit health care and wire fraud, two counts of health care fraud, conspiracy to defraud the United States and to offer and pay health care kickbacks, and two counts of offering and paying kickbacks in connection with a federal health care program. If convicted, Kessler and Gomez each face up to 65 years in prison. In this matter,  both the Federal Bureau of Investigation (“FBI”) and the Department of Health and Human Services Office of Inspector General (“HHS-OIG”) work together to aggressively investigate the allegations and prosecute those that steal from benefit programs.

The HHS-OIG fights waste, fraud, and abuse particularly in Medicare and Medicaid. Fraud schemes that bill for medically unnecessary equipment are a threat to both taxpayer-funded healthcare programs and patients alike. In general, tax-payer dollars are getting wasted on equipment that is not needed, and patients are receiving equipment that could be harmful.

The DOJ’s Health Care Fraud Unit routinely prosecutes defendants who orchestrate schemes that result in the loss of hundreds of millions of tax-payer dollars. The HHS-OIG, FBI, and DOJ all play a crucial role in investigating and prosecuting Medicare fraud to ensure that federal funds are used for what they were originally intended for – helping those seeking aid  receive the assistance they need.

How We Can Help

Medicare fraud is a serious issue that bilks taxpayers out of billions of dollars and endangers patient health. Whistleblowers play a crucial role in exposing fraud, holding bad actors accountable, and getting the justice that patients deserve. The False Claims Act (FCA) allows whistleblowers to file qui tam lawsuits against entities that defraud government programs, such as Medicare and Medicaid.

Securing an experienced legal counsel is crucial for whistleblowers bringing forth qui tam lawsuits. Miller Shah has extensive experience in litigating healthcare fraud cases, and together we can help the government counter fraud and win recoveries. If you believe you have insider information regarding a Medicare fraud scheme, contact us online or call 866-540-5505 to arrange a consultation.