Businessman pleads guilty in wheelchair-fraud scheme

An Ohio businessman faces up to 15 years in prison after pleading guilty in Lynchburg yesterday to conning customers, many of them elderly, into buying wheelchairs by making them think they were purchasing motorized scooters.

Michael Cowen, head of Active Solutions of Worthington, Ohio, also agreed to forfeit $2.5 million, along with four vans, a truck and a 2003 BMW. The government has already seized $1.8 million from him. Cowen pleaded guilty to two charges, conspiracy and health-care fraud, in U.S. District Court in Lynchburg.

Federal prosecutors alleged that Cowen's company used deceptive television commercials between 2002 and 2005 to dupe people into buying 200-pound motorized wheelchairs when they thought they were buying lightweight scooters. The company used the purchases to file Medicaid and Medicare claims worth nearly $26 million.

An audit determined that federal health programs overpaid $3.5 million overall in Virginia, Ohio and West Virginia, Assistant U.S. Attorney C. Patrick Hogeboom III said.

Cowen's company sold several thousand wheelchairs in nine states, and as many as 125 Virginians may have been duped into buying them, prosecutors said.

Prosecutors said the company added expensive wheelchair extras that patients didn't need and billed Medicare and Medicaid for them. The wheelchairs were marketed as three-wheel "freedom scooters."

Cowen initially had been charged with 32 counts, but all but two charges were dropped as part of a plea agreement. He faces up to five years in prison on the conspiracy charge and up to 10 years on the fraud charge, as well as fines of up to $500,000.

A business partner, Jan Michael Bliwas, has pleaded guilty to his role in the scheme. Cowen's wife, Bonita Cowen, also pleaded guilty to obstructing an audit by the U.S. Department of Health and Human Services.

Michael Cowen, who is being held in the Lynchburg jail, is to be sentenced April 3. Bliwas and Bonita Cowen are scheduled to be sentenced later.

Contact Rex Bowman at (540) 344-3612 or .