PORT ANGELES — Two medical supply companies in Port Angeles were part of a Federal sting operation breaking up a $1.2 billion Medicare scam that peddled unneeded orthopedic braces to hundreds of thousands of seniors via foreign call centers.
The Justice Department announced charges against 24 people across the U.S., including doctors accused of writing bogus prescriptions for unneeded back, shoulder, wrist and knee braces. Others charged included owners of call centers, tele-medicine firms and medical equipment companies.
Federal agents served search warrants Tuesday morning at Canoga Medical Supply and Certified Medical Supply Inc on 8th Street. The two businesses appear to share the same website. No arrests were made, but Emily Langlie from the US Attorney’s Office in Seattle said that search warrant affidavits would be made public in the near future.
Medicare’s anti-fraud unit said it’s taking action against 130 medical equipment companies implicated. They billed the program a total of $1.7 billion, of which more than $900 million was paid out.
Telemarketers would reach out to seniors offering “free” orthopedic braces, also touted through television and radio ads. Beneficiaries who expressed interest would be patched through to call centers involved in the scheme. Officials described an “international telemarketing network” with call centers in the Philippines and throughout Latin America.
The call centers would verify seniors’ Medicare coverage and transfer them to telemedicine companies for consultations with doctors.
The doctors would write prescriptions for orthopedic braces, regardless of whether the patients needed them or not. In some cases several braces were prescribed for the same patient.
The call centers would collect prescriptions and sell them to medical equipment companies, which would ship the braces to beneficiaries and bill Medicare. Medical equipment companies would get $500 to $900 per brace from Medicare and would pay kickbacks of nearly $300 per brace.
Officials say the scam was detected last summer.