Father and Son Sentenced to Prison for $27 Million Hearing Aid Healthcare Fraud

Terry Anderson and his son, Rocky Anderson, were found guilty of multiple counts of health care fraud and aggravated identity theft following a 10-day trial in 2018. On Thursday, August 5th, 2019, it was announced that the duo would serve eight and seven years in prison, respectively. In total, Terry Anderson and Rocky Anderson were found to have submitted more than $27 million in fraudulent hearing aid claims to Blue Cross and Blue Shield of Texas.

According to the Department of Justice, the Andersons ran a business called Anderson Optical & Hearing Aids Center, which had multiple locations in Texas. This business was used to submit the defendants’ fraudulent claims to Blue Cross and Blue Shield, although many of the patients did not require hearing aids or never received them.

In an effort to gain additional patients for more claims, the defendants performed multiple marketing tactics, including the promise of free high-end sunglasses, gift cards, or prescription eyeglasses for participating in a complimentary hearing test. Upon completing the hearing test, many patients were told that they suffered from mild hearing loss and required the use of hearing aids. Patients were then asked to sign a consent form for the ordering of the hearing aids, which would also be provided at no cost. The Anderson pair also told patients that copayments and deductibles would be waived.

Starting in 2012, the Andersons began marketing their services to American Airlines by setting up stations at their airport facilities and offering free hearing aid tests to employees of the airline. According to the Department of Justice, the defendants typically generated long lines of interested employees due to the promise of free sunglasses. However, witnesses claimed that the hearing tests were typically only 3-5 minutes long and were not involved enough to properly evaluate hearing loss.

Through the Anderson’s American Airlines scheme alone, $27 million in fraudulent claims were submitted to Blue Cross and Blue Shield, resulting in Anderson Optical & Hearing being paid nearly $17 million.

During the trial, Terry Anderson testified in his own defense, blaming the patients’ interest in free sunglasses for the submitted claims. “Well, unfortunately among us are people that will take advantage of perhaps any program, if they have an opportunity to.”, stated Terry Anderson. However, this defense was not effective as he will serve eight years in federal prison and has been ordered to pay a restitution fee of $13.7 million. He has also been ordered to forfeit over $3 million across nine bank accounts, multiple vehicles, and a 300 acre ranch. Meanwhile, his son will serve seven years in federal prison and must pay a restitution fee of $8.4 million.