FORMER MEDICAL EQUIPMENT COMPANY INDICTED FOR ROLE IN MEDICARE FRAUD SCHEME

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, October 24, 2013

Former Owner of Salt Lake City Medical Equipment Supply Company Indicted and Three Company Employees Plead Guilty for Roles in Medicare Fraud Scheme
A former owner of a Salt Lake City medical equipment supply company has been indicted and three former company employees have pleaded guilty for allegedly engaging in a $20 million Medicare fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney David B. Barlow of the District of Utah, Special Agent in Charge Mary Rook of the FBI’s Salt Lake City Field Office, Special Agent in Charge Gerry Roy of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Kansas City Regional Office, and Special Agent in Charge Janice M. Flores of the Defense Criminal Investigative Service’s (DCIS) Southwest Field Office made the announcement.

Jacob Kilgore, 34, of Fruit Heights, Utah, was indicted in the District of Utah on three counts of health care fraud, three counts of false statements relating to health care matters, and three counts of wire fraud.

According to court documents, Kilgore was the co-owner, vice president, and regional sales manager of Orbit Medical Inc. (Orbit), a durable medical equipment supplier located in Salt Lake City specializing in power wheelchairs.  From approximately September 2008 through June 2011, Kilgore allegedly directed a scheme to defraud Medicare by submitting false and fraudulent claims to Medicare for power wheelchairs.  Court documents allege that Kilgore and others falsified medical records – including power wheelchair prescriptions and chart notes obtained from physicians – to make it appear that beneficiaries qualified to receive power wheelchairs when they did not and that the claims otherwise met all Medicare requirements.  Kilgore and others then used these falsified documents to support false and fraudulent claims from Orbit to Medicare.

Additionally, former Orbit sales representatives Morgan Workman, 35, of Farmington, Utah; David Evans, 29, of South Jordan, Utah; and Hunter Hartman, 29, of Ladera Ranch, Calif., have each pleaded guilty to conspiring to commit health care fraud, based on the same alleged scheme to defraud Medicare.  They are awaiting sentencing.

The scheme allegedly resulted in more than $20 million in claims from Orbit to Medicare for power wheelchairs, of which Medicare paid more than $15 million.

The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

The case was investigated by the FBI, HHS-OIG and DCIS.  This case is being prosecuted by Trial Attorney Niall M. O’Donnell of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mark Y. Hirata of the U.S. Attorney’s Office for the District of Utah.

LA COMPANY PLEAD GUILTY IN POWER WHEELCHAIR FRAUD

FROM:  U.S. JUSTICE DEPARTMENT 
Monday, August 26, 2013
Former Owner of Los Angeles Medical Equipment Supply Company Pleads Guilty to $2.6 Million Medicare Fraud Scheme

A former owner of a Los Angeles-area medical equipment supply company pleaded guilty today to a $2.6 million Medicare fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Special Agent in Charge Glenn R. Ferry of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office made the announcement.

Akinola Afolabi, 54, of Long Beach, Calif., pleaded guilty before U.S. District Judge Philip S. Gutierrez in the Central District of California to one count of health care fraud.

According to court documents, Afolabi was the owner and president of Emmanuel Medical Supply, a durable medical equipment (DME) supply company located in Long Beach.  Afolabi admitted that from approximately June 2006 through September 2009, he engaged in a scheme to commit health care fraud through the operation of Emmanuel by providing medically unnecessary power wheelchairs and other DME to Medicare beneficiaries and by submitting false and fraudulent claims to Medicare.  Afolabi admitted that he obtained Medicare beneficiary information through various means, including “marketers,” whom he paid to refer Medicare beneficiaries to Emmanuel for the purpose of using that information to submit, and cause the submission of, false and fraudulent claims to Medicare on behalf of Emmanuel.  Afolabi admitted knowing that the prescriptions and medical documents were fraudulent and that some of the beneficiaries did not receive the DME, yet he certified to Medicare with the submission of each claim that the DME was received and was medically necessary.

From approximately June 7, 2006, through Sept. 28, 2009, Afolabi, through Emmanuel, submitted approximately $2,668,384 in fraudulent claims to Medicare for power wheelchairs and related services, and Medicare paid Emmanuel approximately $1,490,532 on those claims.

At sentencing, scheduled for Nov. 25, 2013, Afolabi faces a maximum penalty of 10 years in prison and a $250,000 fine.

This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. This case is being prosecuted by Trial Attorney Fred Medick of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion.  In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers