Memorial Medical Supply: Billing Medicare in the Names of the Dead

The Memorial Medical Supply fraud case involved Medicare claims in deceased beneficiaries’ names, conduct its general manager admitted in a January 2010 guilty plea. The Houston durable medical equipment business used illegally obtained patient information to bill for equipment that, in many instances, beneficiaries had never ordered and physicians had never prescribed. Patient identities became the basis for bills to Medicare, even after the patients had died.

What the General Manager Admitted

In his guilty plea to conspiring to commit health care fraud, announced by the Justice Department on January 15, 2010, Memorial Medical Supply’s general manager admitted that he and others illegally obtained Medicare patients’ information. It came from individuals and home health agencies. The information included names, birth dates, medical histories, Medicare numbers and Social Security numbers.

He admitted that the information was used to submit false Medicare claims for arthritis kits, power wheelchairs, diabetic supplies and incontinence supplies. In many instances, beneficiaries neither ordered nor needed the equipment, and a physician had not prescribed it. He also admitted that Memorial submitted false claims in the names of deceased beneficiaries. His plea put Memorial’s Medicare claims at more than $4.3 million from May 2006 through January 2009.

That puts the patient information at the beginning of the scheme. A medical history and a Medicare number gave the billing operation details it could use to describe a patient and seek payment. The manager’s admissions show how far those details could travel from actual care: the paperwork could name a real beneficiary even when there was no prescribed equipment, no request for it, or no living patient to receive it.

Why the Date of Service Matters

The Justice Department’s later account of the owner’s criminal trial reported claims for equipment supposedly delivered to 34 deceased Medicare beneficiaries. The trial evidence showed that doctors’ and beneficiaries’ names and Medicare numbers were used to falsify medical records and claims to Medicare and Medicaid. Many claims concerned equipment never provided.

That same Justice Department account reported that two patient recruiters admitted in their guilty pleas to receiving money in exchange for patient information and billing numbers. The scheme bought the information, built false medical records around it and billed for supposed care. Medicare paid the supplier. The people named on its claims did not even have to be alive.

The Supplier Holds the Delivery Story

Memorial’s manager admitted that the operation obtained detailed beneficiary information. He also admitted that physicians had not prescribed many of the items. A file can contain an accurate name and medical history while the transaction built around them is false.

A supplier employee sees more than a name on a claim. The employee may know who brought in the patient information, whether an order came from the treating physician and whether the equipment ever left the supplier.

Delivery Tickets and Eligibility Checks in Other Cases

Other durable medical equipment cases turn on evidence beyond a date in a billing system: an alleged delivery ticket bearing a dead patient’s signature, or an eligibility check showing the supplier knew the patient was dead.

In its announcement of criminal charges involving Hope & Miracle DME, the Justice Department alleged that delivery tickets contained forged signatures of a deceased beneficiary after her death. The allegation put the falsehood in the receipt itself.

The government’s complaint against Arriva Medical alleged that the company checked a patient’s Medicare eligibility, learned she was deceased, and later shipped and billed for diabetic testing supplies. The complaint alleged that Arriva sent strips, lancets and control solution and billed Medicare the following month.

What Evidence Is Needed to Report Medicare Fraud?

For deceased-beneficiary equipment billing, the useful evidence connects the beneficiary’s death date with the claimed service, the delivery file and what the supplier knew. Memorial’s plea admissions explain the use of patient information. Hope & Miracle’s alleged delivery tickets show the importance of the receipt. Arriva’s alleged eligibility check shows why the company’s knowledge matters as well as the submitted claim.

A billing employee may recognize the claim and the patient record behind it. Someone responsible for delivery may know whether the receipt matches an actual shipment. A manager may understand how beneficiary information entered the business and how it became a bill. We work with insiders to connect those different views to the company’s decisions and the government payments at issue.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know What the Billing File Leaves Out

If you know how a supplier kept billing in deceased patients’ names, speak to one of our whistleblower experts about how the billing continued. We build your strongest Medicare whistleblower case with you, bring in Medicare fraud whistleblower lawyers who understand durable medical equipment billing, and stay beside you as the case moves forward.