A leading auto insurer is suing to recover nearly $800,000, alleging a sweeping fraud scheme involving no-fault insurance claims and medical equipment in New York.
GEICO and its affiliated companies filed a complaint in the United States District Court for the Eastern District of New York on Sept. 19, 2025, naming Live Again Medical Supply Inc., its owner Richard Anderson, and a group of unnamed defendants.
The lawsuit accuses the defendants of devising a scheme, beginning in 2017 and continuing through the present, to submit more than $2.2 million in fraudulent insurance charges for durable medical equipment and orthotic devices – items such as cervical collars, lumbar supports, and positioning cushions – provided to individuals claiming injuries from car accidents in New York.
According to the complaint, Live Again Medical Supply and Anderson, in conjunction with others not presently identifiable, colluded with operators and managers of various no-fault medical clinics to obtain prescriptions through the payment of kickbacks and other financial incentives.
These prescriptions, purportedly issued by healthcare providers, were allegedly used to submit billing to GEICO containing numerous fraudulent misrepresentations concerning the equipment provided to insureds. The complaint states that the defendants billed GEICO alone more than $2.2 million.
GEICO alleges that the defendants billed for equipment that was not medically necessary, was provided as a result of decisions made by laypersons rather than licensed providers, and that the bills misrepresented the type and nature of equipment provided to fraudulently inflate reimbursement rates. The insurer claims that the actual equipment provided, if any, was of low quality and did not match the higher-value items billed to GEICO.
The complaint references New York’s “No-Fault” laws and associated fee schedules, including the New York State Medicaid program and Workers’ Compensation Durable Medical Equipment Fee Schedule, which set maximum permissible charges for DME and OD. GEICO alleges that the defendants submitted bills using Healthcare Common Procedure Coding System (HCPCS) Codes that did not accurately represent what was provided and that charges for non-fee schedule items were fraudulently inflated.
At the heart of the case are New York’s “No-Fault” laws, which require auto insurers to provide up to $50,000 per insured for medically necessary healthcare expenses following a car accident. The complaint details how the defendants allegedly exploited regulatory loopholes and manipulated billing codes to inflate reimbursement rates, including billing for custom-fitted or custom-fabricated devices, requiring specialized expertise, when only off-the-shelf products were supplied.
GEICO is seeking to recover more than $790,000 it claims was paid out on fraudulent claims since 2020. The insurer is also asking the court to declare that it is not legally obligated to pay an additional $680,000 in pending claims submitted by Live Again Medical Supply. The lawsuit brings claims under the federal Racketeer Influenced and Corrupt Organizations (RICO) Act, as well as for common law fraud and unjust enrichment.
The complaint describes that Anderson and Live Again Medical Supply did not market their services to the general public or build relationships with legitimate healthcare providers. Instead, they allegedly relied on collusive arrangements with clinic operators—referred to as “Clinic Controllers”—and a revolving door of healthcare providers to generate a steady stream of prescriptions.
These prescriptions, the insurer claims, were often generic, vague, or even issued without any real patient examination, giving the defendants the opportunity to bill for the most expensive equipment codes.
The complaint also highlights the broader risks to the insurance industry posed by such schemes. GEICO notes that inflated charges for durable medical equipment can quickly exhaust an insured’s no-fault benefits, leaving less coverage available for legitimate medical needs.
The insurer argues that schemes like the one alleged in this case threaten the integrity of the no-fault insurance system and drive up costs for insurers and policyholders alike.
