According to a survey published by the Hearing Review, mid-range hearing aids can average around $4,000 a pair. A custom pair fitted by an audiologist can cost close to double that amount and many insurance plans won’t pick up any of the bill. Perhaps that’s why so many public employees in New York fell for a licensed hearing aid dispenser’s claim that their health insurance provider would cover up to $3,000 for their prescribed hearing devices. (Sounds like a pretty good deal to me.)

According to a story posted on CNYCentral.com, the hearing aid business owner submitted more than 575 claims seeking $1.65 million in reimbursement from the state employees’ health insurance plan. (The problem was that the hearing aid provider was not actually dispensing medically necessary hearing aids, although he was billing as if he were.)

With the help of a co-conspirator, the business owner solicited hundreds of employees from the state’s prison system and a hospital, promising that the public workers’ health care plan would pay for the medically necessary hearing devices. The patients actually received high-tech ear buds commonly used with mp3 players, gaming devices and computers or hearing protection normally marketed to hunters, law enforcement or industrial workers. (As you might guess, these devices were not covered under the state’s health insurance plan.) He also billed the insurance company for hearing aids provided to relatives of state employees also covered under the state’s plan, although the devices were never provided.

The co-conspirator, who happened to be a New York State correctional facility officer, was paid up to $300 for each referral he passed along. The article stated that he received about $70,000 for the referrals and further research revealed that he used the funds to purchase jet skis, a boat, a pickup truck, auto-racing equipment and an ocean cruise. (Sounds like he was living it up at taxpayer expense.)

The hearing aid business owner pleaded guilty to first and second degree larceny for selling public employees custom fit earbuds that were billed as medically necessary hearing aids. The 37-year-old was ordered to pay $1.65 million in restitution to the state and is expected to serve a prison sentence of between four and 12 years for his illegal actions. The co-conspirator pleaded guilty for his role and paid $72,000 in restitution. He was sentenced to a one-year conditional discharge and paid a $500 fine.

This fraudster lured hundreds of public employees into a lucrative health care scam with the intent of lining his pockets with cash he did not deserve. Let’s hope that when this criminal is sentenced, he will hear the judge’s message loud and clear without the assistance of a hearing device—if you defraud the government, you will pay.

The post Loud and Clear appeared first on Fraud of the Day.