DR. COMFORT CEO TO PAY $27 MILLION TO SETTLE WHISTLEBLOWER CASE

Rickey Kanter, CEO of Dr. Comfort will pay $27 million to settle a whistleblower case revealing Dr. Comfort’s illegal Medicare reimbursement. Two former employees blew the whistle and will share in $4.8 million in the civil recovery under The False Claims Act. Dr. Comfort sold diabetics show inserts which did not comform with Medicare requirements but were sold to Medicare beneficiaries and the company received Medicare moneys. Even after he was warned in 2006, kanter continued to sell the noncomplying inserts to Medicare patients. According to the complaint, around 2004 Medicare would reimbuse only for a kind of heat molded insert of certain thickness. In June Medicare rejected a Dr. Comfort insert as being too thin. The company continued selling the thinner sole as Medicare approved. The company’s COO, David Schlageter resigned over the scheme in 2006 and filed a whistleblower lawsuit under the False Claims Act and received immunity from prosecutors. Unknown to him, another relator had filed a claim earlier under seal. A criminal case is still pending