That persistence led Barbuty to investigate what she thought was a case of overbilling of Medicare by a medical supply company that supplied her mom with a rental wheelchair for several years.
Over the last decade, Elizabeth Schram’s body started to fail. The Bridgewater mother of eight suffered two hip replacements and two knee replacements and later, dementia set in.
In 2001, Schram, then 84, moved into an assisted living facility, and within a year, her mobility deteriorated such that she needed a full-time manual wheelchair. With the help of her children, Schram contracted with Community Surgical Supply of Toms River, and she signed a contract for a wheelchair rental.
Monthly invoices of $125 for the wheelchair and $60 for leg rests would be sent to Medicare and Horizon Blue Cross/Blue Shield, her supplemental insurer, and Schram would be billed for a monthly co-pay. That started in March 2002.
The years passed and the rental continued, moving with Schram to a full-service nursing home that could better care for her dementia.
In December 2003, Schram’s assets were depleted and she was eligible for Medicaid. Community Surgical continued to receive payments from the government, supplemental insurance and Schram for the wheelchair rental.
In 2006, Schram was no longer able to maintain an upright sitting position, so she now needed a reclining wheelchair, which was provided by the nursing home. Community Surgical was contacted to pick up the rental wheelchair and it did, and billing for the chair stopped.
In 2007, Schram entered hospice care, and in August, 2008, she died at age 91.
Her daughter was responsible for managing the estate, and the job was nearing completion when in October 2009, the estate and one of Barbuty’s sisters were served with an Ocean County Small Claims Court notice. Community Surgical was demanding $3,000 because it said the wheelchair was never returned and there were rental costs that were never paid.
“I pulled what records I had retained and started to do some research,” Barbuty said. “It seemed ridiculous that we could have paid for so long and not paid the wheelchair off at some point.”
Barbuty wrote a letter to Community Surgical president Jerrold Fried, requesting billing records, a copy of the contract and other documentation so she could prepare a response to the complaint.
Fried didn’t write back, but a week later, Barbuty received a copy of a letter Fried had written to the court, requesting the matter be removed from the docket.
She thought that was the end. But on May 21, the estate and Barbuty’s sister received another complaint filed in Small Claims Court.
Furious, Barbuty did some research and some math.
Wheelchairs like the one her mom used retail for $545.
She determined that for 45 months, Community Surgical had been paid $107.50 per month for the wheelchair rental: $86 combined from Medicare and BC/BS and $21.50 from Schram. That adds up to $4,837.50 in payments for a wheelchair that retails for a fraction of that cost.
Barbuty then took a look at Medicare regulations.
“Medicare regulations require capped rental items (including nonmotorized wheelchairs) to be transferred from supplier to beneficiary after 13 months of use,” Barbuty said, adding that Community Surgical had over-collected $2,752 from Medicare and
BC/BS and $688 from her mother’s estate.
That’s when she called Bamboozled.
Bamboozled started by looking at Medicare/Medicaid regulations.
“Under current law after you’ve rented a piece of equipment for 13 months the title is supposed to transfer over to the beneficiary,” said Medicare spokesman Peter Ashkenaz. “Previously it was 15 months, so for this beneficiary after Medicare paid for 15 months the company should have given her the title to chair and it could have been hers to own.”
Medicare would have continued to pay the company quarterly maintenance fees on the chair, he said.
So it appears the wheelchair was paid for after 15 months and ownership should have been turned over to Schram. Instead, Community Surgical continued to bill and receive rental fees for an additional 30 months.
We filled Medicare in on the overpayments for Schram’s wheelchair, and the agency did its own research. It came back with the answer we expected.
“We will be contacting the company to ask for the overpayment to which we believe we are owed,” Ashkenaz said.
That only amounts to $258, though, because Medicare can recapture only overpayments made within a three-year window. Community Surgical gets to keep the rest.
Bamboozled also contacted Horizon BC/BS, the insurer who also made rental payments on the chair for the same time period, to let it know it had been overpaying on the chair. BC/BS said it’s investigating.
Then there was the matter of the second small claims summons. We called Community Surgical president Jerry Fried.
He refused comment for this story.
A few days after our call, Barbuty received another piece of mail from Community Surgical. It was a copy of a note from Jerry Fried to the court, stating: “The defendant has reached a mutual agreement with the plaintiff in this case and we respectfully request that this case be dismissed.”
That was news to Barbuty, who said she was never contacted by the company so there was no “mutual agreement.”
“I was outraged,” she said. “I couldn’t believe the audacity of this company and I began to wonder how many other people, many of whom wouldn’t have the ability to fight back, were being harassed by this bully.”
We, too, wondered how many small claims cases have been filed by Community Surgical against its customers. Since 2007, court records show the company has filed nearly 500 cases in small claims courts in varying New Jersey jurisdictions. We don’t know the circumstances surrounding each case or how many were against former customers, but those are a lot of filings.
Fried of Community Surgical did not respond to our additional calls.
We’re hoping Fried and the company decides to return to Elizabeth Schram’s estate the $688 in overpayments Schram made for her co-pays for the wheelchair rental.
Barbuty said she is considering taking Community Surgical to small claims court if it doesn’t return the overpayments. That’s the only way the estate will see the money, she said.
“I feel vindicated, and not even for myself, but I hope we’re helping to shed some light on this company,” she said.