The repayment follows an inquiry by AG Reilly's Medicaid Fraud Control Unit (MFCU) after HearUSA voluntarily disclosed an audit containing improper MassHealth billings by Thomas W. Fell Company, Inc. Fell is a wholly owned subsidiary that was acquired by HearUSA in August 2002.

MassHealth provides comprehensive health care benefits, including hearing aids, to some of the state's neediest citizens. This settlement requires HearUSA to return overpayments of $312,873, together with interest of $35,000 and investigative costs of $5,000. As part of the overbilling, small amounts were owed to other state agencies including the Massachusetts Commission for the Blind, Massachusetts Rehabilitation Commission and the Veteran Services Department.

HearUSA contracts with MassHealth to provide audiology services, hearing aids, and hearing aid accessories to Medicaid members. When HearUSA acquired Thomas W. Fell Company in August 2002, it discovered that Thomas Fell had been submitting incorrect claims to MassHealth for hearing aids and hearing aid accessories, by failing to include the bulk discounts it received from the hearing aid manufacturers in its cost-based claims to MassHealth. HearUSA notified MassHealth of Thomas Fell's incorrect billing and the resulting overpayments, and AG Reilly subsequently conducted an investigative audit of Thomas Fell's billing practices during the time period of November 2000 through August 2002.

In addition to HearUSA's voluntary disclosure, AG Reilly's MFCU inquiry revealed additional billing errors by Thomas Fell which HearUSA's agreed to repay as well. Specifically, the AG found that Thomas Fell had improperly provided an excessive number of hearing aids to certain MassHealth members without the appropriate prior
authorizations, and had failed to maintain the required records and documentation. In the course of its investigation, AG Reilly's MFCU analyzed audit reports, spreadsheets, correspondence, cost and billing documentation, as well as patient files regarding Thomas Fell's delivery of MassHealth audiology services and products and its billing practices.

In addition to the payment of restitution, HearUSA is required to augment its current compliance program with additional training for billing department personnel, monitoring activities and a semi-annual review of a sample of Medicaid Program billings.

HearUSA cooperated with the Attorney General's inquiry and it's payment does not require it to admit or deny any improprieties.

This case was handled by Assistant Attorney General Toby Unger and was investigated by Investigator Timothy Johnson and Data Analyst Anthony Megathlin, all of AG Reilly's MFCU.

By The Associated Press