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A DME Fraud of Epic Proportions

dme telemedicine fraudBy: Michael Silverman

Almost two years after “Operation Brace Yourself” regarding purported telemedicine and orthotic bracing fraud made national headlines, on February 4, 2021 the Department of Justice Announced that a major player in that fraud – Florida businesswoman Kelly Wolfe – recently pled guilty to criminal health care and tax fraud charges.

Operation Brace Yourself was a 2019 crackdown on the illegal use of telemarketing and telemedicine to generate fraudulent claims for DME orders, whose reach spanned continents and ultimate implications defrauded taxpayers out of billions of dollars.

According to the Department of Justice Press Release and Settlement Agreement, Mr. Wolfe was seemingly a significant mastermind in establishing hundreds of DME companies that went on to defraud US taxpayers and Medicare beneficiaries.

Here are some highlights of the recently signed Settlement Agreement between the United States DOJ, Kelly Wolfe and her company Regency, Inc.

  • Kelly Wolfe (“Wolfe”) owned and operated Regency, Inc. (“Regency”) which was a DME billing and consulting company.
  • Regency’s consulting services included the establishment and sale of ‘turnkey’ DME companies, which she sold to clients across Florida, California, and elsewhere. These companies were enrolled and ready to submit claims to Medicare.
  • “Wolfe and Regency established hundreds of DME fronts through deceit, craft, and trickery through the credentialing process that Medicare required for billing privileges.”
  • After being established, those DME companies allegedly went on to engage in “unlawful kickbacks through telemedicine companies, created fraudulent orders for DME supplies, including medically unnecessary orthotic braces, and then submitted claims to Medicare for reimbursement.”

The hundreds of fraudulent DME companies that Wolfe helped establish and set on course to conduct illegal activities unfortunately affected the lives of thousands of defrauded beneficiaries, taxpayers, and unsuspecting and ignorant well intentioned business owners and their families.

Wolfe and Regency agreed to a $20.3M civil settlement, and Wolfe faces up to 13 years in Federal Prison upon sentencing, which has not yet been set.