Medical Supplier to Pay $29 Million to Settle Claims That It Violated the False Claims Act

Earlier this month, the US Department of Justice (DOJ) and medical supplier Lincare Holdings Inc. reached an agreement to settle claims that Lincare violated the False Claims Act (FCA) by overcharging Medicare for oxygen tanks.

Lincare is a durable medical equipment (DME) company headquartered in Florida, which provides in-home respiratory care to patients through hundreds of centers throughout the country. Medicare reimbursement for the equipment rented by DME suppliers is limited to three years of continuous use. Following those three years, DME suppliers are required to continue to lease the equipment to the beneficiary for the remainder of its useful life (five years) but are not eligible for reimbursement from Medicare for any further lease payments during that time. After five years, DME suppliers are permitted to replace the equipment and resume billing for another 36 months of payments.

Two former Lincare employees filed a qui tam complaint alleging that Lincare had violated the FCA by improperly billing Medicare for oxygen tanks after the first 36 months. As part of the settlement agreement, Lincare admitted that it improperly billed Medicare, Medicare Advantage Plans, and beneficiaries for this equipment; did not have effective controls to ensure that Medicare was not improperly billed; and failed to address employee concerns about billing practices. Of the $29 million settlement amount, almost $12.6 million is slated for restitution, over $5.655 million will be paid to the relators, and $362,000 will cover the relators’ fees, costs, and expenses.

Read the source article at The National Law Review