Fraud charges stick on Band-Aid scam

In February 2014, the Corporate and Financial Investigations Department received information accusing a medical supply business of submitting false claims to Blue Cross Blue Shield of Michigan. The claims were for services rendered to a member for an excessive amount of bandages and dressings.   

CFI’s  investigation revealed that Robert Daniels, owner of United Health Services, was charging Blue Cross daily for bandages that were never purchased or delivered to nine different members. The amount Blue Cross paid for the false claims was more than $1.7 million.   

During an on-site audit, CFI investigators found copies of invoices that turned out to be forged and fraudulent. They interviewed Daniels, and he confessed to the fraudulent billing. And while interviewing Daniels, CFI investigators also found evidence of him practicing bogus doctor signatures on prescription pads for the false claims.   

The Michigan State Police – Caro Post was contacted and subsequently conducted a search warrant at United Health Services. A 15-count felony warrant was issued for Daniels by the Tuscola County Prosecutors’ Office.  Daniels was then arrested and pled guilty to multiple charges of health care fraud and false pretenses over $100,000 with restitution to Blue Cross.  

It’s important that members check their explanation of benefits statements for any suspicious claims. Some false claims go unnoticed when members have no immediate out-of-pocket expenses. Keeping an eye on your EOB statements will help deter fraud. 

We urge Blue Cross and Blue Care Network members who suspect health care fraud to call our Anti-Fraud Hotline at 1-800-482-3787.