Health Care Fraud—Motorized Wheelchairs

Linda Morgan, a doctor who practices in Houston without a Texas license, has been indicted on one count of conspiracy and 12 counts of health care fraud related to motorized wheelchairs.^[1]

Ms. Morgan allegedly allowed “freelance marketers and recruiters” to bring Medicare and Medicaid patient information to her and she then, for a $250 fee and without seeing the patients, would sign prescriptions for motorized wheelchairs.^[2] The marketers then sold the prescriptions to durable medical equipment companies in Texas and other states.^[3] Medicare and Medicaid were billed for motorized scooters and accessories, with the companies being reimbursed with approximately $5,000 per transaction; the scooters that the patients actually received were worth between $800 and $1,200 each.^[4]

Ms. Morgan’s alleged actions are responsible for approximately $10 million in Medicare and Medicaid billing.

Health Care Fraud
The Health Care Fraud Unit of the FBI estimates that fraudulent billings to health care programs comprise between 3 to 10 percent of total health care expenditures.^[5] Defrauding health care benefit programs, such as Medicare and Medicaid, is covered by 18 U.S.C. § 1347. Under section 1347, it is a crime for a person to knowingly and willfully execute, or attempt to execute, a scheme or artifice—

• to defraud any health care benefit program;^[6] or
• to obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any health care benefit program,^[7]

in connection with the delivery of or payment for health care benefits, items, or services. A violation of section 1347 can be punished by a fine, imprisonment for not more than 10 years, or both.

Conspiracy
The conspiracy charge is covered by 18 U.S.C. § 371, which we have covered here.

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[1] Harvey Rice, Doctor Indicted in Wheelchair-Fraud Scheme, Houston Chronicle, Sept. 15, 2005, available here.
[2] US Attorney’s Office, Press Release: Doctor Arrested in Multi-Million Dollar Motorized Wheelchair Fraud Scheme, Sept. 15, 2005, available here.
[3] Id.
[4] Id.
[5] Federal Bureau of Investigation, Financial Crimes Report to the Public, C1 (May 2005), available here.
[6] 18 U.S.C. § 1347(1).
[7] Id. § 1347(2).