Hearing Aid Scam

Healthcare fraud takes many forms – often with attempts to defraud the government or insurance entities by filing false claims. The government (and as a result, the taxpayers) are clearly victimized – but what about the patients who are the unwitting pawns in such a scheme? Recently, a father-son team was convicted for their role in scamming American Airlines employees.

The two Texas-based men owned a company, Anderson Optical and Hearing Aids Center. Starting in 2011, the company advertised a series of hearing tests in exchange for free luxury sunglasses and gift cards, sometimes up to $100.00. After a short test, the Andersons frequently informed their patients that they had mild hearing loss which required hearing aids, promising them that they would be supplied at no extra cost. Of course, these hearings aids would almost never arrive for the patients. In some cases, the Andersons told their patients that they did not have hearing loss yet, but they would likely develop it. Therefore, they advised the individuals to go ahead and order the devices in the event their benefits were reduced, or they were laid off – American Airlines was going through bankruptcy at the time.

According to court documents and the arguments of the prosecution, the duo specifically targeted American Airlines employees that benefited under the company-sponsored insurance plan. Prosecutors claimed this was done because before 2014, these particular insurance plans had no annual limit on the cost of hearing aids, and the subscribers could receive new hearing aids one time per plan year.

Eventually, the Andersons became so brazen that they brought their scheme into the actual airport facilities of American Airlines, where mechanics and employees who worked on noisy airport tarmacs would eagerly await the results of a hearing test. The test was conducted in an airport employee break room and lasted between three and five minutes. Once diagnosed with a fake hearing impairment, the Andersons would file a claim with Blue Cross and Blue Shield of Texas, who paid out more than $16.7 million directly to Anderson Optical and Hearing. In 2013, nearly 90 percent of the company’s profits came directly from payouts of Blue Cross/Blue Shield.

After a complaint, the Texas Department of State Health Services began an investigation. The Andersons provide several patient records to the state agency – including some of the same documents that had been provided to Blue Cross after the company instituted their own audit. The records given to the state agency had been altered when compared to the Blue Cross records.

The ‘patients’ have suffered as well, fearing hearing loss- or worse – having hearing loss and not being adequately treated to prevent and mitigate any damages. The guidelines for dispensing hearing aids require a full examination by a licensed physician to rule out temporary hearing loss, such as impacted earwax or having an ear infection. The Andersons also failed to notify their patients of this requirement. During the trial, one of the Anderson’s appeared to blame some of his patients during his testimony, implying that people will “take advantage of perhaps any program if they have an opportunity to.”

The jury handed down a conviction of eight counts of health care fraud each, a count of conspiracy to commit health care fraud, and four counts of aggravated identity theft. The men each face up to 90 years in a federal prison if sentenced to the maximum extent. Currently, their sentence date is pending. In addition to that, a forfeiture notice has been filed with the courts. This will require the Andersons to forfeit a 300-acre ranch, three cars, and at least $3.1 million the government seized from various financial accounts.

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