A Florida-based provider of oxygen equipment for patients with respiratory ailments agreed to pay $29 million to resolve allegations it violated the False Claims Act by fraudulently overbilling Medicare.
Lincare Holdings, a subsidiary of German multinational chemical corporation Linde, admitted to improperly billing Medicare, Medicare Advantage plans, and beneficiaries for leased oxygen equipment the company had already been reimbursed for by the government, U.S. Attorney for the Eastern District of Washington Vanessa Waldref announced in a press release Monday.
The settlement resolves a lawsuit brought under the qui tam provisions of the False Claims Act by two former Lincare employees, Benjamin Montgomery and Brandon Haugen, who will receive more than $5.6 million.
The details: Between 2012 and 2023, Medicare reimbursed Lincare for lease payments on oxygen equipment. Despite being required to continue to provide the oxygen equipment to patients after three years of payments, the company continued to bill Medicare and patients for rental payments and copays, according to Lincare’s settlement agreement.
Lincare admitted it lacked adequate controls to prevent improper billing after three years of rental payments had already been received, per the settlement agreement.
Additionally, Lincare admitted that for traditional Medicare recipients, it had controls in place to prevent improper billing but those controls were not always effective.
When employees raised concerns about Lincare’s billing practices, company officials told them it was the company’s nationwide practice to continue billing Medicare for each piece of oxygen equipment until Medicare themselves “denied claims for the equipment for the specific beneficiary, at which point Lincare would stop billing for that equipment for that beneficiary,” the settlement agreement stated.
Medicare sometimes denied Lincare’s claims for excessive billing, but the company failed to take additional steps to identify equipment or beneficiaries it was improperly billing, change its billing practices, identify prior overpayments, or refund plans it had previously improperly billed, per the agreement.
Compliance considerations: As part of the settlement, Lincare agreed to a five-year corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services.
The agreement requires the company to hire an independent compliance officer who will chair a compliance committee. The committee will be tasked with implementing and monitoring the agreement.
Lincare did not respond to a request for comment.
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