Lake Shore Medi Car Transit Faces $500,000 False Claims Act Settlement for Medicaid Fraud

The Medicaid program is a need-based health insurance program run by the federal and state governments. In most instances, the federal government matches state funding dollar-for-dollar. However, states generally have latitude in determining the type, extent and frequency of services covered. In Illinois, certain medical transport services (aside from emergency ambulance or air transport) may be covered for eligible Medicaid enrollees, provided certain criteria are met and the situation makes it medically necessary for the patient to receive medical transport. However, as today’s case reveals, transport companies often skirt various federal regulations in an effort to increase profits and maximize billing, which will quickly trigger False Claims Act liability under both state and federal laws.

Details of the case against Lake Shore Medi Car Transit

Lake Shore Medi Car Transit has been operating medical transport services for indigent patients for years and has provided hundreds of thousands of rides since its inception. According to the allegations, the company began engaging in intentionally fraudulent behavior in 2001 and actually placed patient safety at risk to double- and triple-bill the Illinois and federal governments for reimbursement.

Specifically, the company and its owner are alleged to have picked up multiple patients on a single trip, making the first patient in the vehicle wait for treatment while the driver visited multiple locations. From there, the company billed Medicaid for mileage for each separate patient, notwithstanding the fact that they took a ride together. The complaint points to one prime example from March, 2007, where the company billed 12 separate mileage transport invoices in a single day for the same vehicle and the same patients, all of whom were transported at the same time.

Over time, the company recouped close to $1 million in mileage overcharges occurring across 218 separate trips with Medicaid patients. The company also billed over 9,000 other separate claims for rides provided to patients who were not billed for corresponding medical care on the same date. In another allegation, the government points to a bill for medical transport for a patient who was confirmed to be hospitalized at the time of the alleged trip.

Following the settlement, the company and its owner are both indefinitely prohibited from participating in Illinois’s Medicaid program, which is known as the Medical Assistance Program. This represents a relatively harsh punishment as compared with the typical restrictions imposed against providers, which usually amount to five or ten years.

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By | 2018-09-12T12:46:23+00:00 February 27th, 2015|Medicaid Fraud|