[Post updated June 2019] The year was 2012 when diabetic supply company AmMed settled a whistleblower Medicare fraud action brought by a former company salesperson. Bryan McNeese claimed that AmMed was illegally hawking diabetic supplies to Medicare recipients.
McNeese filed a lawsuit under the federal False Claims Act in 2009 and after three years of investigation, the government intervened and settled the case for $18 million. For his efforts, McNeese received a whistleblower award of $2.8 million. As we mentioned in yesterday’s post, Medicare won’t pay for products sold through telemarketing. Medical purchasing decisions should be based on medical need and doctor prescriptions, not telemarketers who posses no medical training and only want to hustle commissions for making sales.
Just before the case was resolved, the AmMed was acquired by Arriva Medical. We thought the problems were resolved and patients would be protected.
That may not be the case (see our updates below).
While eating lunch today, I came across a half page ad in the Tampa Bay Times. The advertisement is for an external men’s catheter. With headlines of “no out-of-pocket cost” and “covered by Medicare,” I became intrigued. Just how big is the market for durable medical equipment or “DMEs”? Turns out, it is huge.
Interested by the ad, I was reminded of the AmMed story and decided to see how Arriva Medical was marketing its diabetic supplies. According to the many complaints on pissedconsumer.com, not very well.
This is a sampling of what we found:
- “My uncle who has dementia moved in with us. When we were cleaning his apartment we could not believe how many diabetic devices he had. Now I know why. Arriva Medical apparently got our phone number and has been calling us day and night to order more supplies. I had six calls yesterday and it is 9 AM and they have already called. I told them emphatically not to call us; that we would call them if we needed anything but it doesn’t matter to them. I am sure they are ripping off Medicare by selling product to seniors that don’t need or want them.”
- “They are the most uncaring company, when all I wanted was my diabetic supplies, all they were interested in selling all other medical supplies wish I didn’t need, I gave up with them and thank god I don’t do business with them….”
Many of the complaints detailed orders not delivered while many others said the company used very high pressure sales tactics.
In fairness to the company, Arriva Medical did respond to every complaint. We also note that bad customer service isn’t Medicare fraud.
Our concern with all these diabetic supply companies is how they market. High pressure sales tactics – assuming the complaints are true – lead to patients making unnecessary purchases, purchases that may not be medically necessary.
When patients purchase needless supplies and testing equipment or purchase supplies that aren’t medically necessary, two things happen. First, taxpayers are left holding the bag. Medicare, Medicaid and Tricare are all paid with tax dollars. When a Medicare beneficiary gets ripped off, we all get ripped off.
The other problem is patient safety. There is no allegation that Arriva Medical’s products are inferior or bad. However, we often see providers that deliver expired drugs or defective equipment.
We have no evidence that Arriva is violating the False Claims Act or is engaged in Medicare fraud. We wonder about all the other companies that are selling diabetic supplies or other DMEs. We count almost 20 companies actively peddling diabetic supplies. We would love to hear from anyone who has sales scripts or inside knowledge of how these companies are marketing their products.
[Update June 2019]
Arriva Medical LLC Charged with Medicare Fraud
The apple didn’t fall far from the tree. The above post was written in January 2016. We wondered if Arriva was up to the same dirty tricks. You would think that the parent company might be a bit more careful.
Last month the Justice Department charged Arriva Medical, LLC , its parent Alere, Inc., and Ted Albin, of Stuart, Florida, who worked as a “reimbursement consultant” for both companies. All were charged with Medicare fraud under the False Claims Act. In this case, “reimbursement consultant” appears to mean stealing monies from taxpayers.
The complaint alleges that the three submitted false claims to be submitted to the Medicare program for medically unnecessary glucometers and paid kickbacks to Medicare beneficiaries in the form of free glucometers and waivers of their copayments. The complaint also says that Arriva was billing claims for people who were dead.
Two other men have already agreed to pay a total of $1 million for their role in the scheme.
At this point, Arriva, Alere and Ted Albin are presumed innocent.
Call for Healthcare Whistleblowers
If you know of companies telemarketing products and billing Medicare or sending supplies not ordered, we would like to speak with you. Medicare fraud costs taxpayers tens of billions of dollars each year. Concerned healthcare workers are our first line of defense.
The federal False Claims Act pays whistleblower awards to people with inside information about Medicare fraud. As noted in the 2012 AmMed case, awards can be in the millions of dollars. In fact, the current Arriva case was also filed by a whistleblower.
Want to learn more? Visit our Medicare fraud whistleblower page. Think you qualify as a whistleblower? Give us a call. Our whistleblower clients have received over $100 million in awards. All inquiries are kept strictly confidential and there is never a charge for our services unless we collect an award for you.
For more information, contact attorney Brian Mahany at or by telephone at (414) 704-6731 (direct).
MahanyLaw – America’s Medicare Fraud Whistleblower Lawyers