by Rex Bowman
Published: November 29, 2007

WSLS 10 On Your Side originally broke this story in January and May of 2006.  Read the update on charges being filed from our media partner, the Richmond Times-Dispatch below:

Federal prosecutors in Roanoke are accusing an Ohio businessman of deceiving people into buying power wheelchairs for which he then billed the Medicare and Medicaid programs nearly $26 million.

The company sold several thousand wheelchairs in nine states, and as many as 125 Virginians may have been duped into buying them, said Assistant U.S. Attorney C. Patrick Hogeboom III. The wheelchairs cost between $5,000 and $8,000.

In a federal indictment unsealed yesterday, prosecutors say Michael Cowen’s company, Active Solutions of Worthington, Ohio, used deceptive television ads to make clients—who included the elderly and infirm—think they were buying lightweight, highly mobile scooters, when in fact they were buying 200-pound motorized wheelchairs.

Active Solutions’ scheme included manipulating doctors into prescribing the wheelchairs so the company could submit claims to federal health-care programs to pay for them, according to the indictment.

Cowen’s business partner pleaded guilty in September to his role, but the scope of the case came to light only yesterday with the unsealing of Cowen’s indictment. Medicaid and Medicare paid out most of the $25.9 million in claims submitted between 2002 and 2005.

“The motorized wheelchairs . . . were not medically necessary, not useable in the environment placed, and not what the beneficiaries believed they had ordered,” according to the indictment. “Some of the units were placed in environments, such as basement apartments and mobile homes where the limited space made it impossible for the motorized wheelchair to freely maneuver from room to room.”

Cowen was arrested in Florida yesterday and will be extradited to Virginia, Hogeboom said.

According to the indictment, Cowen owns 55 percent of Active Solutions. His partner, Jan Michael Bliwas, owns the remaining 45 percent. In September, Bliwas pleaded guilty in U.S. District Court in Roanoke to conspiracy to commit health-care fraud, telemarketing fraud, mail fraud and money laundering. Bliwas is scheduled to be sentenced Dec. 20.

Cowen’s indictment alleges that the company’s commercials, which at least one Roanoke television station aired, featured power scooters with steering tillers, but when interested buyers called, sales representatives signed them up for motorized wheelchairs. Then, in conference calls with doctors, sales representatives referred to the wheelchairs as “power-chair scooters”—a term coined by Cowen—so doctors thought they were being asked to write prescriptions for power wheelchairs while buyers continued to think they were purchasing scooters, according to the indictment.

The indictment, handed up by a federal grand jury in Roanoke on Nov. 15, charges Cowen with 32 counts including conspiracy to commit health-care fraud, conspiracy to launder money, health-care fraud, mail fraud, telemarketing fraud and wire fraud.
Contact Rex Bowman at (540) 344-3612 or .