Respironics Inc., headquartered in Murrysville, Pa., has agreed to pay $34.8 million to resolve alleged False Claims Act violations for paying kickbacks in the form of free call center services to durable medical equipment suppliers that bought its masks for patients with sleep apnea, the Department of Justice announced Wednesday.
“The whistleblower in this case lives in South Carolina, and he brought to our attention alleged civil fraud a year and a half ago,” said U.S. Attorney for South Carolina Bill Nettles, whose office originated the case.
The U.S. Justice Department’s Civil Division’s Commercial Litigation Branch, the federal Health and Human Services Office of Counsel to the Inspector General and the National Association of Medicaid Fraud Control Units also participated.
Investigating federal civil fraud cases has been one of the Nettles’ top priorities since taking office.
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The whistleblower in the case has been identified as Dr. Gibran Ameer, a Columbia area pharmacist who has worked for different durable medical equipment suppliers (DME) companies. He brought a lawsuit under seal under the qui tam provisions of the False Claims Act, which allows the government to investigate the allegations and step in to the lawsuit if it finds the claims have merit.
The False Claims Act permits private citizens with knowledge of fraud against the government to bring a lawsuit on behalf of the United States and to share in any recovery.
Respironics will pay roughly $34.14 million to the federal government and roughly $660,000 to various state governments based on their participation in the Medicaid program.
Ameer will receive $5.38 million out of the federal share of the recovery.
As part of the settlement, Respironics admitted no guilt.
The government alleged that the conduct began in April 2012 and continued until November 2015.
“The payment of illegal remuneration in any form to induce patient referrals threatens public confidence in the health care system,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, said in a news release. “Americans deserve to know that when they are prescribed a device to treat a serious health care problem, the supplier’s judgment has not been compromised by illegal payments from equipment manufacturers.”
The civil case was brought under a federal anti-kickback law that prohibits the knowing payment of any remuneration to induce the referral of services or items paid for by a federal healthcare program, such as Medicare, Medicaid or TRICARE.