Medicare Compliance & Reimbursement

Industry News:

Ambulance Companies Go All Out to Grab a Bigger Piece of the Federal Pie

Prosecutors pursue new vehicles of Medicare fraud

As a settlement in a district court case in the Eastern District of New York recently brought to light, even ambulance companies have joined the healthcare fraud brigade to make their quick millions.

What Medicare Law Says

Under Medicare "Part B" -- Supplementary Medical Insurance for the Aged and Disabled -- Medicare covers medically necessary ambulance services. Ambulance services are deemed medically necessary "if they are furnished to a beneficiary whose medical condition is such that other means of transportation are contraindicated." (42 CFR 410.40) Although "bed-confinement" is itself neither sufficient nor required as evidence of medical necessity, it is a "factor to be considered." A Medicare beneficiary is bed-confined if three requirements are met: "(i) the beneficiary is unable to get up from bed without assistance; (ii) the beneficiary is unable to ambulate; (iii) the beneficiary is unable to sit in a chair or wheelchair." Fraud Cases Highlight Frequency According to allegations in a qui tam suit, the former CFO of Metropolitan Ambulance & First Aid Corp. (now known as SEZ Metro Corp.), Metro North Ambulance Corp. (now known as SEZ North Corp.) and Big Apple Ambulance Service Inc. (formerly known as United Ambulance), and the president of the companies, Steve Zakheim, used misleading records to appeal a Medicare refund demand. What these companies were essentially doing was giving an old healthcare fraud game their own spin: taking patients around on unnecessary, expensive ambulance trips, and billing Medicare for the same.

When it was later determined that these trips were unnecessary, the government demanded a refund of the tens of millions of (tax payer) dollars that had been paid out and a $2.5 million settlement.

Although Zakheim's case is one of the latest to have hit the spotlight, ambulance fraud has been around for years. A post on www.medicaresmostwanted.blogspot.com reported that Muhammed Nasiru Usman, of Arlington, Texas; David McNac of Dallas and Shaun Outen of Aubrey were each charged with one count each of conspiracy to commit healthcare fraud and multiple counts of healthcare fraud in 2009 for falsely billing Medicare, Texas Medicaid, and the Federal Employees Health Benefit Program for nonemergency ambulance transportation of patients to and from dialysis appointments starting in early 2004. Usman was the owner of Royal Ambulance Services, and First Choice EMS,

where McNac was employed as a director.

Prosecutors said all three were responsible for fraudulent billing exceeding $1.5 million and the payment of more than $550,000 by Medicare, Medicaid, and private insurance. During their trial, prosecutors said, "The fraudulent claims misrepresented medical conditions of patients in order to qualify for reimbursement from Medicare, Medicaid, and private insurance, and falsely stated that  legitimate ambulance services were provided. In reality, many of the companies' records revealed that patients rode to their appointments in a captain's chair in the back of the ambulance rather than lying on a stretcher."

Greybore Medical Transportation Pays $6 Million

Another fraud which was reported on www.wnd.com said that in spite of knowing that Medicare only covers nonemergency transportation when the patient is confined to bed, Greybor Medical Transportation, an ambulance service in Los Angeles, courted elderly patients who wanted "free" rides in an ambulance. When Greybor passed the charges along to Medicare, it attached false certificates indicating that all the patients who got these rides were bed-ridden and soon amassed profits of $2.5 million in fraudulent billings. The owners of Greybor eventually agreed to repay Medicare $6 million.

Check This Ambulance Fraud List

Trial lawyers Frohsin & Barger LLC (www.frohsinbarger.com/) have identified the following types of ambulance fraud:

  • False billing for ambulance service to patients who are not bed bound or otherwise in need of transport by ambulance;
  • False records reflecting fictitious patient conditions intended to justify unnecessary ambulance service;
  • False records indicating health services -- such as oxygen -- that were not provided;
  • False billing for individual transport when transport was in fact provided on a group basis;
  • False billing for ambulance services that were never provided; and
  • Paying Illegal kickbacks to nursing homes and assisted living facilities in exchange for referrals of dialysis patients.

(Editor's note: Read details of the Metropolitan Ambulance case at: www.justice.gov/opa/pr/2010/June/10-civ-662.html; details of the Royal Ambulance Services case at: www.medicaresmostwanted.blogspot.com/2009/06/ambulance-firmsaccused-of-medicare.html; and details of the Greybor case at: www.wnd.com/index.php?pageId=56821.)

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