Prison for man in adult diaper fraud

September 11, 2009 3:19:49 PM PDT
A Houston man was sentenced to two years in prison for defrauding Medicaid of more than $680,000 through an adult diaper fraud scheme. Ene Etim "Ermest" Hogan, 60, owned and operated Shanet Medical Source, a medical equipment company, where authorities say Hogan routinely billed Medicaid for adult incontinence supplies such as adult diapers, underpads, wipes and pull-up briefs, even though he did not deliver to the Medicaid beneficiaries, or the amount of supplies provided were significantly less than the amounts stated in the claims.

From 2004 through 2006, Hogan billed Medicaid for incontinence supplies even after his delivery staff and contractors were told by the beneficiaries they did not need or want the incontinence supplies. Hogan billed Medicaid for a total of $1,108,667 and received payments for those fraudulent claims totaling $683,360.

A judge denied Hogan's request for a lower sentence stating that his conduct was a systematic scheme to defraud the Medicaid program.

In addition to the prison term, the court imposed a three-year-term of supervised release and further ordered Hogan to pay $550,000 in restitution to the federal medical benefits program since Hogan already paid $133,360 of the total amount he fraudulently received in payments following the filing of a state civil suit to recover an overpayment.

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