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KS company paying millions in Medicare fraud case

October 23, 2013 by Hays Post Leave a Comment

global medical directThe owners of Kansas-based Global Medical Direct, LLC and Global Medical Inc., Robert Shea and Mark Franz, have agreed to pay $7 million to resolve allegations against them in connection with a scheme to submit false claims to the federal Medicare and Tricare healthcare programs, announced United States Attorney Kenneth Allen Polite, Jr. from the Eastern District of Louisiana along with United States Attorney Barry Grissom, from the District of Kansas. 
The companies have also agreed to pay to the United States $5 million in proceeds from the sale of all of the companies’ assets to settle civil allegations under the False Claims Act.  Shea and Franz will also receive twenty-year exclusions from participation in any federal healthcare program as part of the settlement. 
 
Global Medical, Inc. and its parent company, Global Medical Direct, LLC, are mail-order diabetic supply companies.  The United States contends that, between April 1, 2008 and January 31, 2012, owners Robert Shea and Mark Franz caused Global Medical and Global Medical Direct to enter into numerous marketing contracts with insurance brokerage and other companies with customer bases likely to have a high percentage of diabetes patients and paid these companies based on the number of patients referred for diabetic supplies.  The Anti-Kickback Statute makes it unlawful to pay or receive remuneration for patient referrals because of the high-potential for billing abuse to Federal programs, such as Medicare, resulting from these types of arrangements. 
 
The settlement resolves the companies’ and its owners’ civil and criminal liability for their participation in the wrongdoing.
 
The investigation and prosecution of the companies and their owners was conducted jointly by the U. S. Attorney’s Offices for the District of Kansas and the Eastern District of Louisiana, the Office of the Inspector General for the Department of Health and Human Services, and the Federal Bureau of Investigation. 
 
“Patients have a right to expect that medical suppliers have justly earned the opportunity to win government business,” said Mike Fields, Special Agent in Charge, Office of Inspector General, U.S. Department of Health and Human Services, of the region including Louisiana.
“Besides the dollar settlement, two of Global’s owners are now banned from government health programs for at least the next two decades.”   
 
 

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