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Catch of the Week: Lincare Holdings

Posted  August 31, 2023

This week’s Department of Justice (DOJ) Catch of the Week goes to Florida-based Lincare Holdings, Inc., a wholly-owned subsidiary of the German chemical corporation Linde plc.  On Monday (August 28), the DOJ announced that the company agreed to pay $29 million to settle charges of violating the False Claims Act by overbilling Medicare and Medicare Advantage Plans for oxygen equipment.

Lincare provides oxygen equipment for respiratory ailments such as Chronic Obstructive Pulmonary Disease.  Many patients lease the equipment for use at home or while traveling.  Between 2012 and 2023, Medicare provided three years of reimbursement for the lease payments, covering the full purchase price of the equipment.  After that period, providers such as Lincare were required to continue providing the equipment to the patients but without further charge.  Many Medicare Advantage plans operate under the same system of reimbursement.

Under the settlement, Lincare admitted improperly billing Medicare, Medicare Advantage Plans, and patients for oxygen equipment rental payments and co-payments after it had already received 3 years of payments.  Lincare also admitted that when certain employees raised concerns about these billing practices, Lincare officials ignored them and instructed them that Lincare would continue its improper billing practices.

In announcing the settlement — the largest-ever health care fraud settlement out of the Eastern District of Washington — the US Attorney for that district Vanessa R. Waldref stressed the egregious nature of Lincore’s misconduct.  Especially because of how it preyed on the elderly:

One of the most important responsibilities we have is protecting vulnerable members of our community such as the elderly, . . . the most likely to be targeted by fraud, false billing scams, and abuse. . . .  I am appalled by Lincare’s admitted past practice of putting profits before its obligations to patients and the Medicare program, and in particular by Lincare’s admitted improper practice of wrongfully collecting co-pays from elderly beneficiaries on fixed incomes and with limited means.

At the same time, Waldref noted she was “heartened that, following our investigation, Lincare stepped up, accepted responsibility, and committed to make things right, not only by refunding overpayments received by Medicare, but by identifying and repaying any beneficiaries from which it improperly collected co-payments.”

Part of Lincare’s remediation is entering into a five-year corporate integrity agreement to take significant corrective actions to ensure this conduct does not recur.  Lincare also agreed to undertake an independent review of its claims and billing practices, and to implement new billing software and other reforms to ensure that Lincare bills appropriately going forward.

This matter was initiated by two whistleblowers who brought a lawsuit under the qui tam provisions of the False Claims Act, which allows private individuals to bring lawsuits on behalf of the government for fraud committed against the government.  In return, the whistleblowers are entitled to receive up to 30 percent of any government recovery.  The two whistleblowers here were former Lincare employees, and they will receive a whistleblower award of $5,655,000 from the government’s recovery.

In a special shout-out to the whistleblowers, Assistant US Attorney Dan Fruchter hailed “the two whistleblowers who came forward and provided vital information, making this result possible.”  He trumpeted the government’s commitment to “continue to work hand-in-glove with courageous whistleblowers . . . to protect patients and the community from fraud and abuse that targets the elderly.”  Over the past 30 years, whistleblowers have been responsible for initiating the majority of successful False Claims Act cases, helping the government recover tens of billions of dollars.

If you would like more information on what it means to be a whistleblower or think you may have information relating to fraud against the government (or misconduct covered by any of the other whistleblower programs), please feel free to contact us so we can connect you with a member of the Constantine Cannon whistleblower lawyer team for a free and confidential consultation.

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Tagged in: Catch of the Week, FCA Federal, Healthcare Fraud, Medicare, Whistleblower Case,