5 ambulance companies to pay $11.5M for Medicare kickback scheme

They allegedly provided deeply discounted ambulance services to health care facilities in exchange for Medicare patient referrals

SAN DIEGO — Five ambulance companies will have to collectively pay more than $11.5 million to the U.S. to resolve Medicare kickback allegations.

The civil settlements include three Orange-County based companies—Pacific Ambulance, Inc. and Bowers Companies, Inc., (both of which were subsequently acquired by Rural/Metro Corporation after the alleged misconduct occurred) and Care Ambulance Service, Inc.; and two San Diego-based companies—Balboa Ambulance Service, Inc., and E.R. Ambulance, Inc., according to a press release from the FBI.

The companies are accused of engaging in “swapping” kickback schemes by providing deeply discounted—and often below cost—ambulance services to hospitals and/or skilled nursing facilities in exchange for exclusive rights to the facilities’ more lucrative Medicare patient referrals.

“We will continue to work closely with our investigative partners to pursue those who refuse to play by the rules and offer kickbacks to induce health care referrals,” said Laura E. Duffy, United States Attorney for the Southern District of California.

The case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General and the Federal Bureau of Investigation. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.

“Today’s settlements resolve a thorough investigation of the practices by ambulance companies that offered significant discount services to facilities in exchange for patient referrals,” said Glenn R. Ferry, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General’s (OIG) Los Angeles Region. “The OIG takes this type of activity very seriously and welcomes the public’s assistance in identifying any health care businesses that engage in similar types of schemes.”

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