Medicare recipients from around the U.S. have said that a company called Pretty in Pink charged their health insurance companies thousands of dollars for urinary catheters that they never ordered or received. Flooded by complaints, the Pretty in Pink Boutique in Franklin, Tenn., a provider of accessories for cancer patients, launched a webpage in September to explain that its leaders were dumbfounded. The boutique said another company with the same name was submitting the claims. The complaints are a piece of an alleged fraud scheme whose scale has little precedent in the history of Medicare, an estimated $2 billion, reports the Washington Post. The case involves fraudulent insurance claims submitted by seven companies to the taxpayer-funded health insurance program. Federal officials are investigating the allegedly fraudulent billing for catheters. the companies collectively went from billing just 14 patients for catheters to nearly 406,000.
Urinary catheters were an appealing target for scammers because orders for the low-cost products — small tubes often made with latex or silicone — could escape scrutiny on billing for expensive equipment, surgeries and other high-cost claims. The alleged scheme was uncovered by the National Association of ACOs — known as NAACOS — a health-care nonprofit that represents hundreds of medical groups and hospitals. The nonprofit’s members said seven companies operating out of Connecticut, Florida, Kentucky, New York and Texas were behind a surge of bills submitted to Medicare for intermittent urinary catheters — tubes that patients insert several times a day to drain their bladders and treat incontinence. While the companies used real patients’ information to submit bills, NAACOS found no evidence that the patients wanted the catheters or even received them. “We’ve just never seen anything like this nationally,” said Clif Gaus of NAACOS, whose members spotted and reported the billings to federal officials last fall. Gaus’s team estimates that Medicare was wrongly billed $2 billion for the catheters in 2022 and 2023. Medicare pays out about $8 per curved tip and sterile kit catheter, but large profits can be made when the products are ordered in bulk.