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Dec. 23, 1999

State orders hearing aid firm to repay $108,000

TUMWATER - The Department of Labor & Industries has ordered a Puyallup-based hearing aid firm to repay the department $108,000 for fraudulently billing the state for services provided to injured workers in the state's workers' compensation system.

The penalties and fees were issued against Ear-Tec Hearing Aid Specialists. The order, delivered today, also notifies Ear-Tec that the agency is revoking the firm's eligibility "as a provider of services, or be paid for services provided" to workers injured on the job.

The investigation was forwarded to the Pierce County Prosecuting Attorney's Office for consideration of criminal charges against Ear-Tec. Labor & Industries and the Pierce County Sheriff's Office today served a search warrant at Ear-Tec.

The State Department of Health and U.S. Food and Drug Administration are cooperating with the investigation.

Ear-Tec has offices in Puyallup, Kent, Aberdeen, Centralia, Spokane and Kennewick.

Labor & Industries says Ear-Tec, among other allegations, engaged in a scheme called "flipping." This means the firm unnecessarily replaced or repaired hearing aids and then billed the department.

The agency also says Ear-Tec fraudulently billed:

  • Using falsified manufacturers' invoices.
  • For hearing aid repairs while the devices were still covered by the manufacturer's warranty.
  • For hearing aid repairs with used parts, without the knowledge of L & I.
  • For services and supplies at a higher rate than for the general public.
  • For unsolicited batteries it sent to claimants.

The audit covered the period between March 1, 1996, and Feb. 28, 1999.

Labor & Industries discovered $26,000 in over billing in the records for 50 L&I claimants. Interest and penalties boosted the order to $108,000

Ear-Tec provided services to 2,603 claimants in the state's workers' compensation system during the last three years.

The investigation continues, and records for the remaining 2,556 claimants treated by Ear-Tec also will be audited.

Ear-Tec has the right to appeal the order, which becomes final in 60 days.

Labor & Industries manages the workers' compensation system in Washington. It provides benefits to workers injured or who become ill as a result of their work. The system covers about 163,000 employers and 1.6 million workers.

Questions about hearing aids that Labor & Industries pays for should be directed to 1-800-547-8367.

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