Government Employees Insurance Company (GEICO) and its affiliates have filed a lawsuit against several New York-based medical supply companies and individuals, alleging a fraudulent scheme involving the state’s no-fault insurance system. The defendants include Healing Touch Supply Inc., Wellness Supply Group Inc., Sunrise Healing Supply Services Inc., R&E Meds LLC, and multiple individuals.
According to the complaint, GEICO alleges the defendants obtained more than $2.5 million by submitting thousands of insurance claims for durable medical equipment and orthotic devices that were medically unnecessary. The alleged scheme involved coordination with medical clinics to obtain prescriptions through improper financial arrangements for items such as lumbar sacral orthoses and cervical traction devices. GEICO further alleges that the defendants manipulated billing codes to increase reimbursement amounts.
The lawsuit claims the defendants operated a coordinated scheme since at least January 2022. Named defendants include Edward Khavasov, Nathaniel Abramov, Daniel Khavasov, and Eduard Keselman, along with unidentified individuals alleged to have exercised control over the operations. GEICO contends these actions violated New York’s no-fault insurance laws. The insurer seeks recovery of paid claims and a declaration that it is not obligated to pay more than $2.2 million in outstanding claims associated with the alleged conduct.
GEICO alleges the defendants misrepresented the nature of equipment provided in billing submissions and charged inflated prices for items that were not reimbursable. The complaint further alleges the use of nominal owners to conceal true control while engaging in improper financial arrangements with clinic operators to obtain patient prescriptions.
GEICO seeks monetary damages exceeding $2.5 million, injunctive relief barring payment of pending claims connected to the alleged scheme, and additional relief permitted by law.
The plaintiff is represented by attorneys Barry I. Levy, Michael Vanunu, Joanna Rosenblatt, and Jaana Singh of Rivkin Radler LLP. The case was filed in the United States District Court for the Eastern District of New York under 1:25-cv-06822.