Making off with millions – in wheelchairs

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Posted: April 02, 2008
1:00 am Eastern

© 2008

In the movies, it takes a fast getaway car to help the criminals escape after robbing a bank. In real life, some criminals are using wheelchairs to steal tens of millions of dollars – right from under our noses.

The owner of a wheelchair distribution company was recently indicted for bilking Medicare and Medicaid out of $25 million. Michael Cowen, who co-founded Active Solutions, an Ohio company doing business in Virginia, is alleged to have billed Medicare close to $8,000 each for "lightweight, collapsible, portable, electric power scooters," but then supplied bulky, heavy, less costly wheelchairs. The indictment alleges that he bought a $1 million airplane and shifted profits offshore.

Every year, the government provides millions of wheelchairs to the elderly. The only requirement is a doctor's order stating the patient has a legitimate need and eligibility for Medicare or Medicaid.

Although many wheelchair distributors are legitimate, there are those who cheat. Several schemes are being used right now to bilk Medicare out of hundreds of millions of dollars – for wheelchairs alone. It is no wonder out taxes are so high!

In 2003, the government cracked down on wheelchair fraud. At one point, it had 50 separate investigations going, known as "Operation Wheeler Dealer." The government sought to recoup more than $150 million in fraudulent claims.

Some unscrupulous companies offered free wheelchair to customers for just calling their company. They promised to bill Medicare or Medicaid, so their customers wouldn't need to do anything. This allowed them to gouge Medicare and Medicaid by charging too high a price for the wheelchairs. Frequently, Medicare is charged $6,000 for something that sells wholesale for under $1,000. Since not everyone is entitled to a free wheelchair, they also created phony doctor's orders claiming all of their customers were eligible. Although the government crackdown successfully shut down many distributors making fraudulent claims, new companies are constantly entering the business of using wheelchairs to cheat Medicare. The practice is so prevalent that every few months another company is charged with wheelchair fraud.

As you know, these fraudulent profits come out of the taxpayers' pockets. If you need another incentive to report Medicare fraud, the Department of Justice will pay you up to 25 percent of what it collects from a company cheating Medicare or Medicaid.

If the government collects $25 million, you reward could exceed $5 million. Last year, a former employee filed a whistleblower claim against the Scooter Store. The court required the store to pay the government $4 million and retracted another $13 million in outstanding invoices to settle fraud charges. As a result, the former employee received over $3 million as a reward for reporting the fraud.

It pays to put the government on the right track to fighting fraud. Of course, you need to have more information to claim a reward than simply seeing a commercial advertising that you can get some free medical devices from a company. To apply for a government reward, you should have inside information as to how the fraud scheme works and knowledge that the company is cheating. If you have that, maybe you can be the one making the fast getaway with millions of dollars – legitimately!

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