A settlement has been reached to resolve False Claims Act allegations against Healogics Inc.
The allegations arose from a lawsuit that claimed Healogics Inc violated the False Claims Act by knowingly causing wound care centers to bill Medicare for unnecessary hyperbaric oxygen (HBO) therapy.
HBO therapy is a service covered by Medicare that is used to treat chronic wounds by exposing the entire body to oxygen under increased atmospheric pressure.
The settlement resolves allegations that from 2010 through 2015, Healogics knowingly submitted or caused the submission of false claims to Medicare for medically unnecessary HBO therapy. Under the settlement, Healogics agreed to pay $17.5 million, plus an additional $5.01 million if certain financial contingencies occur within the next five years, for a total potential payment of up to $22.51 million.
“Medicare beneficiaries are entitled to care based on their clinical needs and not the financial goals of healthcare providers,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “All providers of taxpayer-funded federal healthcare services, whether contractors or direct billers, will be held accountable when their actions knowingly cause false claims for medically unnecessary services to be submitted.”
In addition, Healogics has entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General which includes, among other things, a claims review and a system review both to be conducted by an Independent Review Organization.
Reportedly, Healogics will also pay nearly $400,000 in a separate settlement regarding improper coding.
The whistleblower, James Wilcox, a former Director for Research and Quality for Medical Affairs at Healogics and whistleblowers in a separate lawsuit, Dr. Benjamin Van Raalte, Dr. Michael Cascio, and John Murtaugh, two doctors and a former program director who worked at Healogics-affiliated wound care centers, will receive up to $4,276,900 as part of the settlement.
