North Carolina DME Company and Owner Agreed to Pay $5,000 for Allegedly Violating the Civil Monetary Penalties Law and Be Permanently Excluded for Alleged Unsolicited Telephone Calls to Beneficiaries and Paying Remuneration for Referrals

A durable medical equipment (DME) company and its owner, agreed to pay $5,000, and to relinquish funds being held in suspension, for allegedly violating the Civil Monetary Penalties Law (CMPL) and provisions of the CMPL applicable to physician self-referrals and kickbacks. The DME company and its owner also agreed to be permanently excluded from participating in Federal health care programs under 42 U.S.C. § 1320a-7(b)(7). OIG alleged that the DME company in connection with their contract with a telemarketing company, made unsolicited telephone calls to Medicare beneficiaries to obtain orders for the furnishing of DME for which Medicare pays. OIG alleged that the DME company used the information obtained to submit claims to Medicare for the DME allegedly provided to the beneficiaries. OIG further contends that the DME company knew or should have known that they submitted false or fraudulent claims because they obtained the orders for the DME through telephone solicitations prohibited by the Social Security Act's DME Telemarketing Provisions. Those provisions prohibit suppliers of DME from making unsolicited telephone calls to Medicare beneficiaries regarding the furnishing of a covered item, except in three circumstances. OIG alleged that the telemarketing calls made on behalf of the DME company did not fall into these exceptions. OIG contends that the DME company violated the CMPL by knowingly submitting Medicare claims that they knew or should have known were false or fraudulent for DME ordered pursuant to prohibited telephone solicitations. OIG also contends that the DME company offered or paid remuneration in the form of monetary payments to induce the telemarketing company to refer individuals for the provision of DME for which Medicare would pay or to arrange for or recommend ordering DME for which Medicare would pay.

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