Discreet

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44774391 - spilled blue medicine capsules and pills on the white surface.

Getting old is definitely not for sissies. Some old age issues include aches and pains, memory loss, and mobility issues, not to mention incontinence (which impacts about 13 million Americans). Depending on needs and eligibility, Medicaid in the State of Illinois pays for a range of incontinence supplies if a doctor provides a prescription. Once approved, incontinence products are shipped directly to the beneficiary’s door – in discreet packaging, of course. (You certainly don’t want to advertise your personal health issues with a box of adult diapers sitting on the front porch.) Today’s fraud article profiles a Medicaid fraud scheme run by a former Springfield, Illinois business owner who tried to discreetly steal more than $2.3 million through illegal claims.

The man at the center of the Medicaid fraud scheme operated his incontinence product business from a residence located in Springfield. He sold products such as diapers and pull-ups to Medicaid beneficiaries, including many special needs adults and kids. Over approximately four years, he caused false claims to be submitted to the Illinois Department of Healthcare and Family Services for delivery of incontinence products sold by his company.

The false claims submitted by the Springfield man indicated that Medicaid beneficiaries had received their incontinence products even though they had not received anything at all, or a different quantity than the amount claimed on the bill. (Consequently, in response to the claims submitted, Medicaid paid the man’s company $2.3 million. That’s a lot of diapers.)

It appears that the Springfield business owner went on a spending spree and used the Medicaid-designated funds for himself. He used the government money to buy clothes, food and fuel. He also made a few mortgage payments, entertained himself and travelled a bit. Apparently, he also shared the newfound wealth with a family member. (So much for being discreet. I’m sure the paper trail of expenditures did not help his defense.) About a year after his illegal operation was halted, his business was involuntarily dissolved. (In other words, his government slush fund dried up.)

The former Springfield, Illinois man pleaded guilty to Medicaid fraud for submitting fraudulent bills for incontinence products. The 53-year-old fraudster, who is most recently from Augusta, Missouri, was ordered to serve two years in federal prison. (He must also pay restitution of $582,844 to make up for the overflow of Medicaid funds.) To make sure that this man’s crime serves as a reminder to others who are considering the same crime, the judge also included three years of supervised release, beginning with six months of home confinement.  (Ironically, since he cannot leave his home, like his customers, he’ll be receiving a few discreet deliveries of his own. No doubt, he will not be receiving anything else from Medicaid.)

Today’s “Fraud of the Day” is based on an article entitled, “Owner of former Springfield medical supply business sentenced for fraud,” posted on FoxIllinois.com on March 29, 2019.  

SPRINGFIELD, Ill. (WICS/WRSP) — A former Springfield, Ill. man was sentenced Friday for defrauding Illinois’ Medicaid program.

Kevin W. Schaul’s business supplied incontinence products to Medicaid recipients.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.