Everybody loves free stuff, right? But what if it’s medical supplies you didn’t ask for and don’t actually need? And what if a company keeps sending you stuff after you ask it to stop? Oh — one little detail: it’s not free and you’re left footing part of the bill.

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That’s what fueled a health care fraud investigation back in 2015. It started when two insurance carriers filed complaints with a federal watchdog, alleging a medical equipment company was inappropriately billing patients and their insurers for medical supplies that were often medically unnecessary. The supplies included electrical stimulators called TENS units (transcutaneous electrical nerve stimulators), as well as replacement supplies like electrodes, batteries, and wipes all used for pain management. But, as fraudsters do, the company inflated the values and provided unnecessary supplies, causing insurance carriers excessive billings. And this didn’t happen once — it happened time and time again, even after claimants demanded the company stop sending the supplies.

Our special agents joined forces with five offices of inspectors general and worked together for nine years to unearth a fraud so widespread that it touched every corner of the country.

When filing fraudulent claims, the Tampa-based company had been using internal paperwork that let health care providers select “lifetime” supplies. But after extensive interviews with patients, doctors, and health care administrators, the investigation found the company often submitted claims and sent persistent shipments of supplies when (1) patients hadn’t asked for them, (2) doctors hadn’t prescribed them (this happened but less frequently), and sometimes (3) patients were not even aware the supplies were coming  or had even heard of the company.

Investigators estimated the company fraudulently billed federal programs over $82.1 million in total for the supplies — the Postal Service was billed $6.3 million. Most of the total amount, $50.9 million, was for electrodes sent after electrode-fitted garments had been already delivered, making the additional electrodes redundant and useless. 

But the game for the company and its fraudulent founder was on its last leg. And as investigators scaled up their interviews and brought them out into the open, the company saw a significant drop in claims between 2017 and 2018.

The OIGs brought the case to the Eastern District of Pennsylvania’s U.S. Attorney’s Office, which first accepted the case for criminal and later civil prosecution. In early fall 2024, the parties finally came to an agreement. The company and its founder agreed to pay the United States $20 million plus interest, of which over $9.9 million is restitution for the government.

If you suspect or know of health care provider fraud against the Postal Service or other federal programs, please report it to our Hotline.

For further reading:

Department of Justice (via uspsoig.gov), Electrostim Medical Services, Inc. and Mario Garcia, Jr. to Pay $20 Million to Resolve Allegations of Billing for Excessive and Unnecessary Supplies