Lincare Holdings, Inc. has agreed to the largest ever healthcare fraud settlement in the Eastern District of Washington–$29 million–for violating the False Claims Act and taking advantage of the most vulnerable in our society. Lincare provides oxygen equipment to those with respiratory ailments, leasing oxygen tanks and concentrators to give patients their quality of life back. However, the company was fraudulently overbilling Medicare including Medicare Advantage Plans for this equipment, possibly harming patients in the process. Medicare reimburses providers like Lincare for lease payments on oxygen tanks until the full purchase price of the equipment has been reached. Even after this occurs—a process that typically takes three years—Lincare is still required to provide its services without additional payment because the entirety of it has been covered by traditional Medicare. A similar plan is in place for those with Medicare Part C, also known as Medicare Advantage. Despite this, Lincare improperly billed Medicare and its beneficiaries for rental payments and other fees even after the oxygen equipment had been reimbursed in full. When Lincare employees raised concerns internally, officials in both the Regional Billing and Collections Office in Spokane, WA and their corporate headquarters in Clearwater, Florida said they would continue their current practices, which harmed sick and older Medicare patients across the United Stares for the sake of generating more revenue.
Notably, Lincare admitted to this wrongdoing, further admitting that there were no functional controls to prevent Medicare Advantage plans and beneficiaries from being overbilled, and the controls for traditional Medicare were there, but weak.
In May 2021, two former employees of Lincare courageously blew the whistle, filing a qui tam complaint in the U.S. District Court for the Eastern District of Washington. As a result, a joint investigation was conducted by the U.S. Attorney’s Office for the Eastern District of Washington and the U.S. Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Seattle Field Office. The findings were damning for Lincare. The U.S. Attorney for the Eastern District of Washington said “One of the most important responsibilities we have is protecting vulnerable members of our community such as the elderly … I am appalled by Lincare’s admitted past practice of putting profits before its obligations to patients and to 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.”
In addition to the $29 million, Lincare will also perform extensive corrective actions, refunding the overpayments and repaying any beneficiaries from which it improperly collected co-payments. They also entered into a years-long corporate integrity agreement to create a compliance and reporting program, reform its billing practices, and overall, ensure such fraudulent practices do not reoccur.
Justice would not have prevailed without the whistleblowers, who will receive $5,655,000 of the settlement for their work. The Assistant US Attorney thanked them for “making this result possible. We will continue to work hand-in-glove with courageous whistleblowers, as well as HHS-OIG and our other law enforcement partners, to protect patients and the community from fraud and abuse that targets the elderly.”
If you would like to report Medicare fraud, you can contact attorneys at Tycko & Zavareei LLP. Eva Gunasekera and Renée Brooker are former officials of the United States Department of Justice and prosecuted whistleblower cases under the False Claims Act. Eva was the Senior Counsel for Health Care Fraud. Renée served as Assistant Director at the United States Department of Justice, the office that supervises False Claims Act cases in all 94 United States District Courts. Eva and Renée now represent whistleblowers. For a free consultation, you can contact Eva Gunasekera at [email protected] or contact Renée at [email protected] (tel.: 202-417-3664). Visit Tycko & Zavareei LLP’s website for whistleblowers to learn more at www.fraudfighters.net.