Whistleblowers Claim Boca Raton Company Committed Fraud

According to the Palm Beach Post, three whistleblowers allege that Med-Care Diabetic & Medical Supplies, Inc. (“Med-Care”) committed Medicare fraud in violation of the False Claims Act. Med-Care is a durable medical equipment supply company based in Boca Raton, Florida. According to its website, Med-Care offers a ship-to-home service for various medical supplies including: diabetic testing products such as glucose meters, test strips, lancets and lancing devices; respiratory devices like nebulizers; and catheter and ostomy supplies.

The qui tam complaint filed in the U.S. District Court for the Southern District of Florida alleges that Med-Care violated Medicare’s conditions of payment by pressuring Medicare beneficiaries to accept medical supplies they did not want or need or without first obtaining a doctor’s prescription.

The False Claims Act complaint was initiated by three whistleblowers: Tiffany Bumbury, a former telemarketer in the New York call center of a Med-Care affiliate – East End Associates; Stanley Bernstein, a telemarketer at Med-Care from May 2010 to April 2014; and Jamie Camuccio, a former employee of Med-Care from January 2012 to February 2014. The whistleblowers allege that Med-Care and its principles defrauded the federal government by: engaging in unsolicited telemarketing of Medicare beneficiaries; providing illegal kickbacks to Medicare beneficiaries in violation of the Anti-Kickback Statute; paying illegal kickbacks in exchange for the referral of Medicare patients; and billing for unnecessary medical equipment.

Medicare rules prohibit medical equipment providers from cold-calling Medicare patients. In fact, companies are only allowed to initiate calls to Medicare patients if very specific conditions are met, such as to resupply a product that the patient has previously requested. According to the complaint, the telemarketers were guided by Danny Porush. According the Palm Beach Post, Porush was the inspiration for the character portrayed by Jonah Hill in the movie “Wolf of Wall Street.” Porush was the president and a director of now defunct Stratton Oakmont, Inc.

The federal government declined to intervene in the whistleblowers’ lawsuit. If the whistleblowers are successful in their claims against the company, they may be entitled to share in any recovery as their reward under the qui tam provisions of the False Claims Act.

In addition to the pending civil claim, Med-Care was recently served with multiple search warrants by federal agents. According to the Palm Beach Post, federal officials refused to disclose why Med-Care is being investigated.