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Medicare Cheat Used Homeless in Fraud Scheme

Cheryl Clark, for HealthLeaders Media, October 28, 2010

The "Red, White & Blue Man," a patient recruiter who sold homeless Medicare beneficiaries' personal information to fraudulent Los Angeles medical clinics and durable medical equipment companies, has been ordered to pay $556,815 in restitution and sentenced to 21 months in prison, according to federal officials.

James Roland Fuquay, 49, was called the "Red, White & Blue Man" in reference to the colors on a Medicare card, according to officials for the Department of Justice and the U.S. Department of Health and Human Services.

He recruited Medicare beneficiaries using the sales pitch: "Red, white and blue. Let's make it do what it do," the DOJ said in a statement.

Fuquay paid beneficiaries in San Diego and Los Angeles to go with him to fraudulent medical clinics and DME supply companies "to receive medical services, power wheelchairs, hospital beds and other medical equipment that the beneficiaries did not want, need or receive," the statement said.

Fuquay's network of beneficiaries "was large enough for him to make approximately "$220,000 in illegal recruiter fees," the statement said.

One of the DME supply companies involved was Airport Medical Supply, whose owner, Eli Gichon, directed Fuquay and others to bring beneficiaries, according to court documents. Gichon then took pictures of the beneficiaries sitting in the wheelchairs or standing next to empty hospital bed boxes. "Gichon used these pictures to try to fraudulently prove to Medicare inspectors that he had in fact provided the beneficiaries with power wheelchairs and hospital beds," the DOJ statement said.

Gichon is scheduled for sentencing on Jan. 10. Fuquay also was ordered to serve three years of supervised release following his prison term.


Cheryl Clark is senior quality editor and California correspondent for HealthLeaders Media. She is a member of the Association of Health Care Journalists.
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