Five more arrests in Hungary against the alleged “mafia of medical shoes”

In Hungary, the police are investigating multiple cases of social security fraud involving companies selling medical material, doctors, and care centers. So far, the fraud is estimated to have siphoned off nearly 5 million dollars of public money.

Orthopedic shoes in Hungary
Orthopedic shoes manufactured by a company involved in a case of fraud against Hungary’s social security | © Hungarian National Police

Hungary added five more people to the list of suspects for a vast social security fraud with medical equipment, the Hungarian National Police announced on March 30. The police of Hajdú-Bihar county in eastern Hungary on Tuesday arrested a doctor and her assistant, a company manager and two employees. They seized assets worth over 332 million forints (950,000 dollars, 873,000 euros) from the suspects and the company.

The District Court of Debrecen later approved the custody of the five women suspected of budget fraud committed by a criminal organization. According to the police, the company based in Békéscsaba, the 60,000-people capital of southeast Békés County, illegally collected over 1 billion forints (2.9 million dollars) from public funds over the last five years.

The arrests are the latest of a series of raids that started last November in the case of a social security fraud that became of national scope. The National Investigation Bureau of the Emergency Police conducts the investigations based on a report from the National Defense Service, which is in charge of combatting fraud and organized crime.

Often referred to as the case of the “mafia of medical shoes” in Hungarian media, the scheme consists in companies selling medical aid which receive payment from Hungary’s social security for accessories doctors prescribed to people, often of advanced age, who didn’t need them.

The regional representatives of the company based in Békéscsaba would send orthopedic specialists in order to carry out medical examinations of residents of nursing homes. They then prescribed medical accessories such as orthopedic shoes and seats, and back braces primarily used to treat scoliosis in children, regardless of whether residents really needed them. And the company, after manufacturing and delivering products of poor quality later claimed for, even without authorization, and received State money from the National Health Insurance Fund (NEAK).

Earlier in March, the Győr police searched 10 locations simultaneously and arrested four other people, one remaining in custody, for a similar scheme. Based in Szeged, a city of 160,000 people in the south of Hungary, one of the two arrested doctors prescribed 930 medical shoes. He allegedly helped a company based in Budapest earn almost 50 million forints (143,000 dollars). According to the investigators, the company claimed more than 162 million forints (464,000 dollars) from the NEAK for nearly 3,000 orthopedic shoes the investigators considered illegally prescribed. The two doctors prescribing the shoes didn’t even meet the patients.

Company selling orthopedic shoe
Companies selling medical devices sold them prescription orthopedic shoes and then received payment from the national social security | © Hungarian National Police

The scheme is pretty much similar in all cases across the country, with a company selling medical aid, and doctors making prescriptions for patients from complicit nursing homes or caring centers for disabled people.

Doctors often prescribed medical devices from a list of patients companies directly sent to them. Companies received lists that included patients’ data from various social institutions or directly from the staff of nursing homes. Delivery of the products could even be done by ambulances.

The shoes, generally prescribed for only one foot, were even often sold in pairs. Patients didn’t know the shoes they received were orthopedic shoes. Doctors could even make prescriptions for the same patients several times in a row. Meanwhile, the companies would request the maximum subsidy possible, sometimes using fake personal documents, and patients often did not even have to pay the statutory deductible or only a fraction of it.

Hungary’s social security reimbursed about 50,000 forints (143 dollars) by medical boot. Fraud also included products other than shoes, such as spinal orthoses and various walking aids, as well as wrist orthoses and knee orthoses.

There have been 37 criminal suspects since the proceedings started in November. Two-thirds are in custody, the others remaining under criminal supervision or are at large. Investigations continue but it is so far estimated the scheme siphoned off at least 1.7 billion forints (4.9 million dollars) of Hungary’s public funds.

In November, Dr. Gyula Kinces from the Hungarian Medical Chamber told the Hungarian tabloid Blikk they were in favor of such cases being unveiled but wanted to reassure that only “there are many more honest workers, and fortunately there are few who are wrong.”

In a country perceived as having the worst public sector corruption record in the European Union, according to Transparency International, investigations don’t mention whether there was any support provided for the alleged fraud within the NEAK.

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