Doctor Sentenced for Signing Telemarketer-Generated Medical Equipment Orders, Including for Amputated Limbs

The bottom line: telemarketing was the front end of this health care fraud. Calls gathered beneficiary data, and that data became fake medical records and equipment orders.

Background

Medicare covers elderly and disabled Americans. TRICARE, run by the Department of Defense, covers military personnel, retirees and their dependents. Both cover durable medical equipment (DME), such as oxygen equipment, wheelchairs, crutches and diabetic test strips, but only when ordered by a physician treating the beneficiary for a specific illness or injury as part of that treatment.

The scheme

According to court documents, between May 2021 and September 2023, while Webster lived in Olympia, Washington, and was licensed there:

• A company identified as "Company A" used telemarketers to contact Medicare and TRICARE beneficiaries in Eastern Washington and elsewhere to obtain their personal and health information.
• Company A used that information to create fake medical records reflecting doctor visits and treatment by Webster that never happened, along with fraudulent DME orders.
• Webster signed the documentation and orders, which Company A sold to companies that billed Medicare and TRICARE.
• Company A and Webster also billed the programs for fictitious visits and exams.

According to the DOJ, Medicare and TRICARE paid more than $14.6 million for DME fraudulently ordered by Webster for more than ten thousand beneficiaries. That included beneficiaries who lacked the limb for which Webster supposedly examined them and ordered equipment, because it had been amputated. Webster admitted directly receiving at least $839,565 for visits and exams that never took place.

He pleaded guilty in February 2024. The court also ordered forfeiture of funds in his bank and investment accounts.

Why it matters

In this case, telemarketers collected beneficiaries' personal and health information. That information became the raw material for fraudulent billing. Every participant in the chain, from the call center to the signing physician, faces liability.

What this means for you

1. Do not run health campaigns that collect beneficiary information for resale as orders or leads to suppliers.
2. Never let telemarketing data substitute for a real patient encounter.
3. Vet any client that buys health leads tied to Medicare or TRICARE beneficiaries.
4. Treat physicians or partners who sign equipment orders at high volume without seeing patients as a major red flag.

In health care, a phone call cannot replace a doctor's examination.