The United States Attorney for the Eastern District of Washington announced on August 29, 2023 that Lincare Holdings, Inc., a Florida-based, wholly-owned subsidiary of German multinational chemical corporation Linde plc, has agreed to pay $29 million and perform extensive corrective actions to resolve allegations that it fraudulently overbilled Medicare and Medicare Advantage Plans for oxygen equipment.
Lincare provides oxygen equipment to patients with respiratory ailments such as Chronic Obstructive Pulmonary Disease (COPD), including leasing oxygen tanks and home and portable oxygen concentrators to assist patients to breathe while in the home or traveling. Between 2012 and 2023, traditional Medicare (also known as Medicare Part B) reimbursed providers such as Lincare for the lease payments on oxygen equipment, but after three years of monthly lease payments, providers such as Lincare were required to continue to provide the oxygen equipment to the patient, but were not eligible for additional rental payments because Medicare had already reimbursed the provider for the full purchase price of the equipment. Under Medicare Advantage, also known as Medicare Part C, Medicare Beneficiaries may elect to receive their Medicare benefits through a private insurance plan offered by an insurance company, known as a Medicare Advantage Plan or an “MA Plan.” MA Plans are required to provide the same coverage and benefits as traditional Medicare, but they may set their own rules for reimbursement and beneficiary co-pays. Between 2016 and 2023, many Medicare Advantage Plans adopted the same requirement that limited providers like Lincare to three years of rental payments for oxygen equipment. After 3 years of payments, Lincare and other providers were required to continue to provide the equipment for the remainder of its useful life, but were not permitted to charge rental payments to MA Plans, or charge any co-payments to beneficiaries.
In the settlement announced on August 29, 2023, Lincare admitted that it improperly billed Medicare, MA Plans, and beneficiaries for oxygen equipment rental payments and co-payments after it had already received 3 years of payments. Lincare admitted that it lacked adequate controls to ensure that MA Plans and beneficiaries were not improperly billed after 3 years of rental payments had already been received. Lincare additionally admitted that for traditional Medicare recipients, it had controls in place to prevent improper billing, but that those controls were not always effective. Finally, Lincare admitted that when Lincare employees raised concerns about Lincare’s billing practices, Lincare officials in its Regional Billing and Collections Office located in Spokane Valley, Washington, and at Lincare’s corporate headquarters in Clearwater, Florida, instructed them that Lincare would continue its billing practices. The settlement resolved claims that Lincare’s conduct violated the False Claims Act.
As part of the settlement, Lincare entered into a 5-year Corporate Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) requiring, among other things, that Lincare implement a robust compliance and reporting program as well as a number of significant billing reforms and practices. Additionally, the Agreement requires that Lincare retain, at its expense, independent experts to review its claims and billing practices to ensure they are appropriate.
According to court documents, the case began in May 2021, when two whistleblowers, former employees in Lincare’s center in Libby, Montana, filed a qui tam complaint under seal in the U.S. District Court for the Eastern District of Washington. When a whistleblower, or “relator,” files a qui tam complaint, the False Claims Act requires the United States to investigate the allegations and elect whether to intervene and take over the action or to decline to intervene and allow the relator to go forward with the litigation on behalf of the United States. The relator is generally able to then share in any recovery. In this case, according to court documents, the United States intervened in the action in July 2023, and subsequently reached the settlement. Pursuant to the settlement agreement, the relator will receive $5,655,000 of the total settlement amount.
If you have information regarding false claims having been submitted to Medicare, Medicaid, TRICARE, other federal health care programs, or to other federal agencies/programs, and the information is not publicly known and no actions have been taken by the government with regard to recovering the false claims, you should promptly consult with a False Claims Act attorney (also known as qui tam attorneys) in your U.S. state who may investigate the basis of your False Claims Act allegations and who may also assist you in bringing a qui tam lawsuit on behalf of the United States, if appropriate, for which you may be entitled to receive a portion of the recovery received by the U.S. government.
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