GEICO has taken legal action against what it calls a multimillion-dollar scam involving fake medical equipment claims in New York’s no-fault insurance system. On December 4, the insurer filed a lawsuit in federal court accusing two Brooklyn-based medical equipment suppliers and their owner, Yevgeniya Ivanova, of running a scheme that resulted in over $2.7 million in fraudulent charges over eight months.
According to the complaint, the two companies, J Flexible Corp. and LJR NY Inc., operated one after the other from the same Brooklyn address. J Flexible racked up more than $425,000 in claims from September to November 2024 before shutting down. Then LJR continued the operation, submitting over $2.3 million in claims from December through May.
GEICO alleges that the fraud involved billing for expensive devices that patients either did not need or never received. For example, the companies billed high-end bone growth stimulators at $3,300 each but actually provided cheap portable stimulators. The lawsuit also says mobile patients were prescribed specialized air mattresses for bedridden individuals.
The insurer claims this was more than just inflated billing. GEICO alleges that Ivanova arranged kickbacks with unnamed clinics in the New York metro area, including Queens, Brooklyn, the Bronx, and Mount Vernon. These clinics allegedly steered equipment prescriptions to her companies.
Further evidence of the scam includes suspicious prescription dates when patients had not seen doctors, plus identical prescriptions for multiple passengers from the same car accident even though their injuries and seating positions differed. The suit also points out that some prescriptions were signed by clinic staff without medical licenses, and doctors failed to document equipment needs or follow up with patients.
GEICO is asking the court to declare that it does not have to pay the outstanding claims. The lawsuit includes fraud and unjust enrichment charges against the companies and Ivanova, as well as conspiracy claims involving the unidentified clinics. Additionally, racketeering charges under the federal RICO laws seek triple damages.
The case is still in its early stages, and no decisions have been made on GEICO’s accusations. This lawsuit highlights ongoing issues within insurance fraud and the challenges insurers face in protecting against dishonest billing practices.