Medicare Fraud: Spot It, Report It, Spread the Word

The U.S. government does not provide universal health care, but pays out an estimated $60 billion a year in fraudulent Medicare claims - that is $60 billion with a "b".  A private business that has to earn a profit in order to pay employees and cover their operating costs would not keep their doors open if they had this amount of fraud.  The Obama administration realizes the government is partly to blame for creating  a system which allows this much fraud to happen.  They have setup a website to educate seniors and caregivers about Medicare fraud and to assist us all in reporting it.

How can we stop Medicare fraud?

Learn about how Medicare fraud happens.

Check out 60 Minutes reporting on Medicare fraud to understand the system better.  It is important to realize that the reimbursement claims for home care visits for Medicare skilled care (care provided by a Registered Nurse, Physical Therapist, Occupational Therapist, Speech Therapist) pay very generous amounts to the Medicare agencies for the visits:  $500 per visit for a R.N., for example.  The claim system is complicated - some visits pay more than others - filing a claim is similar to filing a federal tax return.  However, Medicare agencies quickly learn the system and so do those who are seeking to abuse it.  The same type of care for various medical diagnoses pay different reimbursement rates, for example.

Ask questions.

If you or your spouse or relative are receiving skilled care visits by Medicare, ask the agency what the government reimbursement amount will be and based on what qualifying factors.  Ask them how long the care has been approved for and confirm with your referring doctor - - - all Medicare visits must be doctor approved.

Ask your doctor if he is associated with the Medicare agency.  While referral fees are not allowed, doctors are often invited to be on the advisory board or receive other incentives to refer to a certain agency - find out why the doctor refers to the agency and if they refer to more than one agency.

Medicare Fraud Warning Signs:
  • Service is offered for free - free medical equipment or additional free caregiving services
  • No approval needed for services
  • Door-to-door sales call or telemarketing call asking for your Medicare number for pre-approval
  • Medicare is offering you the service for free and a random company is calling to notify you
Note:  Medicare services are pre-approved by your medical doctor after a hospital or nursing home stay and require you to be confined to your home.  Remember, even wheelchairs paid for by Medicare require extensive forms to be filled out, along with pre-approval from a medical doctor (and the Scooter Store, which advertises on Infomercials that they will get your wheelchair pre-approved for you definitely has the legal right to educate you about the Medicare approval process, but as they found out when they were convicted of Medicare fraud, they cannot hire their own doctors to drop by and approve you for a wheelchair).  You may review the Scooter Store Medicare fraud case which also is an indication of the generous reimbursement rates for some Medicare-approved services which is a reason for the high rates of fraud. 

Learn more by reviewing information presented at the national summit on health care fraud.  Senior caregivers should also make sure a senior checks with their doctor before moving forward with any Medicare service, as only their medical doctor will authorize the Medicare home care services.

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Comments (5) -

  • I can't believe Congress spends so much time complaining that we can't afford to provide health care coverage for everyone yet allows billions to be spent on fraudulent Medicare claims and I also can't believe the payouts are so high to attract the fraud - I guess the lobbyists do run things in Washington!
  • It is not surprising the government pays out a lot for fraud, but $60B?!!  Wow that caught my eye!  I wonder how much is detected and actually recovered...?  Another loop hole in our healthcare system that will hopefully draw attention sooner rather than later.
  • At The SCOOTER Store, we appreciate and welcome comments from organizations like yours as well as the general public. We hope to educate your readers about the facts related to the company and this important Medicare benefit. With that in mind, we have some clarifications to your statements.

    Congressional law and Medicare regulations require a patient see their own treating physician for consideration for a power wheelchair. Their medical evaluation is the primary factor when considering whether medical need exists. Prior to the office visit, the patient is subject to our very through screening process. It is during this initial screening process ( that the company disallows 70% of those inquiring about power mobility from insurance consideration.

    Those with medical conditions such as heart disease, lung disease, diabetes and MS (for example) are sent to their own treating physician for further evaluations. The physician will complete a comprehensive examination of the patient; not everyone will qualify. In fact, physicians generally rule out two out of every three patients they see.

    Once a physician provides his prescription and complete medical records to The SCOOTER Store, a team of nurses with 520 years of clinical experience review the medical information to ensure medical necessity has been established by the beneficiary’s physician. We have over 70 Quality Review Standards in place. In the end, only one out of every 11 beneficiaries qualifies for insurance-covered power mobility. The SCOOTER Store has never employed physicians. The doctor-patient relationship is critical in the continuum of care and cost effective outcomes.

    The SCOOTER Store has filled nearly 500,000 prescriptions in 18 years. The company has never been convicted of fraud. While we maintain that every prescription filled is within the rules that govern the Medicare program, we entered into a settlement agreement with the government and a fine was paid. As a result, we are a stronger company. We are committed to ensuring that seniors are fully educated about fraudulent and wasteful practices (

    The company is uniquely positioned to manage costs and improve healthcare outcomes through its more than 70 stores nationwide. An economic study ( shows that we have helped the federal government save nearly $7 billion dollars in fewer hospitalization and emergency room visits due to falls and fall-related injuries.

    Should you have any additional questions or comments, please feel free to contact me at 830-627-4444 or e-mail Thank you.
  • Glad the Scooter Store commented on this - - but, the Federal government did file a lawsuit based on factual evidence that was obvious enough for an employee of the Scooter Store to receive the whistle blower award.  Ouch!  Glad the Scooter Store has cleaned up their act - however, I think their TV commercials are still a bit much as they certainly don't provide the information their PR person gives here - instead they say they'll give the scooter free if they can't get it approved by Medicare.  Looks like the government also changed reimbursements because of their hanky panky so that also makes it more difficult to play games in this area. As a caregiver who has worked with seniors who needed a power wheelchair, I would still recommend going to a local medical supply company as you will probably need a couple visits to get the fitting of the chair just right and will probably get a higher quality chair than what the Scooter Store pushes.  
  • And from Forbes Reporting -the Scooter Store actually caused a huge increase in Medicare costs for inappropriate wheelchairs:

    Government spending on power wheelchairs climbed 450% between 1999 and 2003, to $1.2 billion. A report released last year by Health & Human Services' inspector general found that only 13% of those it surveyed who got the most popular wheelchair met the Medicare coverage requirements. This is what happens when someone is spending other people's money.

    The four contractors that process Medicare's wheelchair claims--Palmetto GBA, Cigna HealthCare, AdminaStar Federal and HealthNow New York--saw a spurt in spending as early as 1997, but the office that runs Medicare and Medicaid did not lead a coordinated response until 2003, says the Government Accountability Office.

    In one egregious case last year the U.S. Attorney in Houston charged two physicians, Charles Skripka Jr. and Jayshree Patel, for conspiring to defraud Medicare of $40 million between February 2002 and June 2003. The duo allegedly approved wheelchairs for up to 50 Medicare beneficiaries per day, in return for kickbacks from the suppliers. The doctors have pleaded not guilty; the owner of their clinic, Lewis Gottlieb, has put in a guilty plea and is helping the government.

    The feds in April sued the Scooter Store of New Braunfels, Tex., which billed Medicare for $400 million or so since 1997. In ads, the Scooter Store suggested to old folks that the government would pay for scooters. But, the government alleges, when customers called the company to inquire about reimbursement, the Scooter Store pushed motorized wheelchairs on them, with the result that Medicare ended up paying for expensive and unnecessary equipment. The government is supposed to pay for a motor-driven chair only if the patient would be confined to bed without one. The Scooter Store says it has done nothing wrong and that the government is trying to get out of repaying legitimate claims.

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