Elliot Loewenstern, was the Vice President of Marketing for the Video Doctors Network, a bogus organization devoted to scamming taxpayers and Medicare. He was, unfortunately, good at what he did.
In the scam, his organization paid kickbacks to telemedicine doctors for prescribing medically unnecessary orthopedic braces to unsuspecting patients.
The scam resulted in Medicare and other insurers losing $424 million. In addition to pleading guilty to one count of solicitation of health care kickbacks and another count of fraudulent claims against the government, he must pay $200 million in restitution to the government as part of his plea agreement.
You Need a Brace
Loewenstern presided over a conglomerate of nothing. His shell companies included a role as Vice President of Marketing of PCS CC LLC, Video Doctor USA or “Video Doctor,” the Telemed Health Group LLC or “AffordADoc.”
The organizations could not have succeeded without thousands of kickbacks and bribes from brace manufacturers, patient recruiters, and brace suppliers. Those scammers could not have succeeded without arranging for doctors to order medically unnecessary orthotic braces.
The recipients of the braces were contacted through the efforts of Loewenstern’s telemarketing network. For the most part, those who were convinced that they needed the medically unnecessary braces were elderly and/or disabled patients.
According to the Department of Justice:
“Loewenstern admitted that many of these orders [for braces] were written after only a short telephone call between the health care provider and the beneficiary, with whom the health care provider had no prior doctor-patient relationship.”
In other words, the healthcare providers often had no contact with the patients. However, Loewenstern devised another revenue stream altogether. He attracted investors to the Video Doctor Network by convincing moneyed people that the organization was a legitimate medical diagnostic provider.
He told would-be investors that the Video Doctor Network was a legitimate telemedicine diagnostic service and that world-wide, they made revenues of tens of millions per year with a hefty profit.
The company purported to have a huge member base who paid for telemedicine consultations. In fact, the millions in revenues came not through legitimate patients but from kickbacks and bribes that were, of course, illegal.
Multi-Level Fraud
That Elliot Loewenstern is a fraudster is a given, and unless our legal system is completely clueless, he will serve jail time. However, he and his business co-conspirators, the healthcare providers, brace companies and patient recruiters who found patients are all culpable in this case.
The fraud was so massive as to almost seem legitimate. In a way, it created its own oversite, even though everyone involved was cashing in on a massive opportunity. Everyone involved was motivated not by patient care, but by blind greed. In fact, the only dupes were the elderly and disabled and their families.
There may have been some fleeting rationalization on the part of Elliot Loewenstern that the medically unnecessary braces in some ways helped patients who in actuality needed no help, but any good was easily erased. After all, he also scammed greedy investors who saw his three fake video doctor companies as being money machines kicking out double-digit profits.
Medicare fraud is not victimless. Everyone who pays taxes is a victim in frauds of this nature, but it goes far beyond that point.
There is a multi-tiered ethical breakdown here that roped in physicians and nurses, investors and healthcare manufacturers in addition to fraudulent business people. It is a societal problem and it is shameful.
LEAVE YOUR COMMENTS!
