Corporate Compliance

DME company owner charged with diaper fraud scheme

Compliance Monitor, February 18, 2009

Ernest Hogan, owner of a Houston-area durable medical equipment (DME) company, Shanet Medical Source, was arrested February 13 for allegedly committing healthcare fraud by billing improperly billing for adult urinary incontinence supplies, according to a Department of Justice (DOJ) press release.
According to the DOJ, from June 2004 to March 2006, Hogan allegedly billed Medicaid for adult urinary incontinence supplies (e.g., adult diapers, underpads, wipes and pull-up briefs) he did not deliver, supplies in excess of the amount provided to the beneficiary and for supplies provided without a proper prescription or who did not need the supplies.
Hogan is charged with 10 counts of healthcare fraud, each carrying a maximum penalty of 10 years in prison and $250,000 fine, according to the press release.

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