CINNCINATI--High profit margins were properly allowed as "relevant evidence" in a case that charged a power wheelchair provider with Medicare fraud, the Sixth Circuit Court of Appeals has ruled.

In an appeal of his 2003 conviction on 22 felony counts--including health care fraud, mail fraud, illegal kickbacks and money laundering charges--Hussein Amr, owner of United States Medical Supply in Livonia, Mich., argued the government's use of his high profit margins on power chair sales was either not relevant to the case or produced "unfair prejudice." But the court disagreed, saying that the evidence showed Amr steered patients who wanted or needed less expensive chairs to the power wheelchairs. In addition, he did not inform patients that they had a right to lease the power equipment.

"[Amr] did so because otherwise he would not have obtained the over $4,000 profit per power wheelchair sold," wrote Senior Judge Cornelia G. Kennedy in a May 25 ruling. "Thus, since the evidence was relevant to establishing [Amr's] motive, the district court properly admitted the evidence ...."

Amr was originally indicted in 2000 for "inducing patients to purchase power chairs they did not want or need, offering free lift chairs to induce patients to purchase power wheelchairs, failing to offer patients the option of renting rather than purchasing the wheelchairs, charging for standard accessories which were already included in the wheelchairs and inflating repair charges."

The government said that the DME provider purchased power chairs for $2,250, then billed Medicare $4,300 and an additional $800 for accessories, resulting in a total reimbursement request of $5,100. USMS would then receive a co-pay of $1,200, usually from Medicaid or Blue Cross, resulting in a total of $6,300--and a profit of more than $4,000--from the sale of one power chair.

Upon his conviction, the jury ordered Amr to forfeit more than $1 million.