Healthcare News & Insights

Diabetic shoe/Medicare scam leads to $27M fine

Rickey Kanter, the former CEO of Dr. Comfort, agreed to plead guilty to mail fraud regarding sales of its shoe inserts to Medicare patients. He faces a $27 million fine and possible jail time.

According to prosecutors, the Mequon, Wisconsin-based company sold shoes and shoe inserts to diabetics and was reimbursed by Medicare for $375,000 worth of unapproved goods. The inserts didn’t meet Medicare’s standards. Prosecutors said Dr. Comfort continued to sell them and bill for reimbursement for two years after it had been warned the inserts didn’t conform to Medicare’s requirements.

Prosecutors have recommend 18 months of prison time for Kanter. He is also barred from participating in any federal health care programs for 15 years, according to the terms of his plea agreement.

Under the False Claims Act, two whistle-blowing former employees will receive a total of $4.8 million from the civil recovery.

Dr. Comfort was recently acquired by DJO Global Inc. Kanter’s plea and settlement were part of the conditions of the sale. A spokesperson for DJO said it’s working with federal agencies to ensure the company is compliant with all regulations in the future.

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