Ambulance Company Executives Plead Guilty to Medicare and TRICARE Fraud and Money Laundering Scheme
Two former owners and an employee of an ambulance services provider headquartered in Guam—an unincorporated and organized territory of the United States—pleaded guilty recently for their roles in a healthcare fraud and money laundering scheme that resulted in a loss to the United States of approximately $10.8 million. This is one of the largest single Medicare ambulance fraud cases prosecuted nationwide.
The two former owners pleaded guilty in the U.S. District of Guam to one count of conspiracy to commit healthcare fraud and one count of conspiracy to engage in monetary transactions with the proceeds of specified unlawful activity. The defendants are scheduled to be sentenced in early 2020.
From approximately March 2010 to March 2014, the defendants conspired to defraud Medicare and TRICARE (both federal health benefit programs) by submitting claims for medically unnecessary ambulance services provided to patients with end-stage renal disease (ESRD). The defendants were aware that the ambulance company was transporting non-qualified patients under applicable Medicare and TRICARE regulations and guidelines. The defendants admitted they knew that many patients being transported were not bed-confined and did not have acute medical conditions to qualify them for ambulance transportation.
The defendants also directed ambulance company employees to remove from internal documents references to patients’ ability to walk because they knew that Medicare and TRICARE would not provide reimbursement. The defendants further admitted they were aware of, but failed to address, concerns about these billing practices raised by other company employees. The conspiracy resulted in the ambulance company receiving improper payments of approximately $10.8 million.
The defendants admitted they used the proceeds of their healthcare fraud scheme to pay for personal expenses, such as vacations, personal income taxes, a personal residence, and other items. They falsely categorized these items as business expenses of the company, which reduced the company’s taxable income and corresponding tax liability.
Compliance Perspective
Failure by a nursing home to ensure that residents with ESRD being transported by ambulance to and from dialysis qualify for such transportation, and using an ambulance transportation service that has been convicted of submitting false claims to Medicare or violating other federal or state laws, might result in the nursing home being excluded from receiving Medicare and Medicaid reimbursement due to violations of state and federal regulations.
Discussion Points:
- Review policies and procedures regarding the qualifications for transporting residents to and from dialysis and for checking the background of any ambulance transportation service for exclusion from Medicare and Medicaid.
- Train staff about the required qualifications for transporting residents to and from dialysis or other appointments to prevent the nursing home from potentially participating, albeit unintentionally, in the submission of false claims by an ambulance company providing transportation services to the facility.
- Periodically audit instances where residents are transported to dialysis and other appointments via an ambulance service to determine if any residents were transported but did not qualify for such transportation.
