Man to Pay $224,620 to Resolve Alleged DME Health Care Fraud

SPOKANE, Washington—Justin Leland has agreed to pay $224,620.88 to resolve allegations he participated in a kick-back scheme to bill Medicare for medically unnecessary durable medical equipment (DME).

Medicare pays for covered health services, including DME, under certain conditions. Durable medical equipment are supplies ordered by a health care provider for a patient’s everyday or extended use, such as oxygen equipment, wheelchairs, crutches or blood testing strips for diabetics. In order for DME to be covered under Medicare, it must be ordered by a physician who is treating the beneficiary for a specific medical problem and must be used as part of the course of treatment for that specific medical problem.

According to court documents, in June of 2018, Leland registered US Professional Medical Supply LLC (USPMS) with the Washington Secretary of State. Leland also obtained a National Provider Identifier as a DME and medical supply company and listed himself as the owner.

In September 2019, Leland submitted approximately 400 DME billing claims to Medicare from USPMS, which all listed Leland as the provider and were ordered by doctors who solicited and received kickbacks in exchange for ordering the DME. In total, Medicare paid out $112,310.44 for these claims.

During the investigation, Federal investigators learned patients received phone calls from telemarketers, provided brief statements to the callers, never actually saw or were examined by a provider, and received DME that they did not actually need.

“This settlement puts durable medical equipment suppliers on notice that they will be held accountable if they attempt to defraud the United States,” said U.S. Attorney Waldref. “These schemes compromise patient care and result in payment for services that are not medically necessary. Such services not only drive-up medical costs for everyone, but in some instances may even prove harmful to patients. My office is committed to stopping health care fraud, protecting the resources of the federal government and protecting the well-being of patients.”

“Durable medical equipment businesses that participate in illegal kickback schemes to boost their profits undermine the public’s trust and jeopardize the integrity of the Medicare program,” said Special Agent in Charge Steven J. Ryan with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “This settlement demonstrates HHS-OIG’s enduring commitment to work with our law enforcement partners to combat health care fraud and aggressively pursue those who exploit federal health care programs.”

The settlement agreement can be viewed here.