Jacksonville-based hyperbaric oxygen therapy company billed Medicare for unnecessary and unreasonable treatments.
Hyperbaric oxygen therapy provider Healogics Inc. agreed to pay up to $22.51 million to settle allegations that it violated the federal False Claims Act by knowingly causing wound care centers to bill Medicare for unnecessary and unreasonable treatments.
The company, based in Jacksonville, manages more than 700 hospital-based wound care centers in the U.S., including at Baptist Medical Center.
Cindy Hamilton, spokeswoman for Baptist Health, said Baptist Medical Center Beaches and Baptist Medical Center Jacksonville contract with Healogics for outpatient wound care services.
According to the U.S. Attorney’s Office Middle District of Florida, 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 possible settlement of $22.51 million.
The company agreed to a five-year corporate integrity agreement with the Department of Health and Human Services Office of Inspector General that includes claims and systems reviews to be conducted by an independent review organization.
The settlement resolves allegations that for five years beginning in 2010, the company knowingly submitted or caused to be submitted false claims to Medicare for unnecessary treatments.
Medicare covers the therapy for wounds that will not heal when treated with traditional means, during which a patient’s entire body is exposed to oxygen under increased atmospheric pressure.
The allegations related to the settlement began with a lawsuit filed by former Healogics Director of Research and Quality for Medical Affairs James Wilcox, and a separate lawsuit filed by Dr. Benjamin Van Raalte, Dr. Michael Cascio and John Murtaugh, two physicians and a former program director who worked at Healogic’s wound care centers.
The suits were filed under the qui tam, or whistleblower, provisions of the False Claims Act. Private citizens with knowledge of fraud against the government can bring action on behalf of the United States and are eligible to share in any recovery.
The settlement provides for the four plaintiffs to share up to $4.28 million.
In a news release, the U.S. Attorney’s Office stated that the claims settled by the agreement are allegations only and there has been no determination of liability.