The DOJ announced it recently settled with durable medical equipment supplier Apria Healthcare to resolve allegations of fraudulent billing practices related to the rental of non-invasive ventilators (“NIVs”).
The case was originally brought in the Southern District of New York under the qui tam provisions of the False Claims Act by three former Apria employees and the government subsequently decided to intervene. In its complaint, the government alleged that beginning in 2014, Apria prioritized the expansion of its rental program for NIVs, complex pieces of respiratory equipment capable of dynamically adjusting the pressure of air delivery based on patient needs, because federal healthcare programs reimbursed providers up to $1,400 per month per NIV. That expansion, however, came at the expense of compliance with billing requirements.
Per the terms of the settlement agreement, Apria admitted to and accepted responsibility for the following misconduct:
- Lack of Medical Necessity. Apria encouraged physicians to order NIVs for their patients. In its promotional materials, Apria indicated that respiratory therapists would monitor patients’ usage of NIVs to ensure compliance with physicians’ instructions and to ensure that continued usage was medically necessary. Despite those representations, Apria’s respiratory therapists failed to conduct the in-home visits to verity that patients were continuing to use the NIVs. Despite this failure, and in some instances even with evidence that continued use was no longer medically necessary, Apria continued to seek reimbursement for the NIV rental.
- Failure to Use Cheaper Alternative to NIV. Apria also encouraged physicians to order NIVs when a bi-level pressure support setting, PAC mode, was medically indicated for a patient. Apria, however, failed to disclose to physicians that the PAC mode setting was available on a different, cheaper device called the VPAP S9. This resulted in Apria renting more expensive equipment, when cheaper alternatives would have satisfied patients’ needs.
- Offering to Waive Co-Pay. Apria also offered co-pay waivers to certain patients and encouraged its salespeople to discuss the availability of waivers, even before patients raised concerns about the ability to pay for NIVs. Apria also offered waivers to patients as an inducement to patients to rent NIVs from Apria instead of other DME suppliers
Apria is required to $40.5 million to settle the claims, with $37,632,789.89 being paid to the United States and the remaining amount to be paid to various states.
The attorneys at Chilivis Grubman represent clients of all types and sizes in connection with False Claims Act investigations and qui tam litigation. If you need assistance with such a matter, please contact us today.