The Acting United States Attorney Audrey Strauss for New York’s Southern District, the Special Agent Scott Lampert in Charge for the New York Office HHS-OIG, Special Agent Patrick J. Hegarty in Charge of the Northeast Field Office of the DCIS, and Deputy Inspector General Norbert E. Vint Performing the Duties of the Inspector General – Office of Personnel Management Office of the Inspector General reported on 21st December 2020 a 40.5 million U.S. dollars settlement of fraud case against Apria Healthcare Group, Inc. and its associate, Apria Healthcare LLC, large DME (durable medical equipment) provider with nearly 300 branch offices situated all over the U.S. The case purports, among other accusations, that Apria Healthcare Group and Apria Healthcare LLC submitted fraudulent and false submissions to federally-funded health care systems, such as Medicaid and Medicare, seeking payment for the rental of expensive non-invasive ventilators to program beneficiaries who were not utilizing the non-invasive ventilators such that the equipment were medically unnecessary or that included the inappropriate waiver of patient co-payment reimbursements.
Under the settlement agreement approved on 18th December by Judge Edgardo Ramos, Apria Healthcare Group and Apria Healthcare LLC assented to reimburse a total amount of 40.5 million U.S. dollars, with 37,632,789.89 U.S. dollars being reimbursed to the U.S. and the remaining sum to be reimbursed to several states. As per the settlement, Apria Healthcare Group and Apria Healthcare LLC further made extensive factual confessions concerning its conduct.
Acting U.S. Attorney Strauss stated that it is vital for the financial integrity of federally-funded health systems like Medicaid and Medicare that payments are made for medically necessary services and items only. Durable medical device providers such as Apria Healthcare Group and Apria Healthcare LLC are responsible for ensuring that the devices and equipment they rent to patients are medically required. When firms disregard that responsibility knowingly to maximize their returns, the attorney’s office will hold them responsible for their deceitful conduct.
DCIS Special Agent Hegarty stated that the DCIS (defense criminal Investigative service) is dedicated to safeguarding the TRICARE integrity. Billing TRICARE for durable medical equipment that was not medically needed betrays the trust of the public. This settlement shows their collaboration with OPM-OIG, HHS-OIG, and the United States Attorney’s Office to inquire deceitful conspiracies that the TRICARE programs and places its beneficiaries in danger.
HHS-OIG Special Agent Lampert stated that Apria Healthcare Group’s and Apria Healthcare LLC’s conduct undermined the Medicaid and Medicare programs’ integrity and unnecessarily increased taxpayers’ financial burden. Together with its partners, the HHS-OIG would persistently ensure that entities and persons that charge federally-funded healthcare programs fraudulently are held liable for their conduct.
OPM-OIG Deputy Inspector General Vint stated that the OPM-OIG is dedicated to combating every form of health care fraud. The settlement demonstrated that providers exploiting federally-funded healthcare systems through submission of fraudulent claims would be held responsible.
As purported in the case filed by the U.S., Apria Healthcare Group and Apria Healthcare LLC in 2014 decided to prioritize the expansion of its non-invasive ventilators rental because healthcare systems including Medicare reimburse as much as 1,400 U.S. dollars monthly to offset non-invasive ventilators, a type of complex respiratory device that can adjust the pressure level of air delivery dynamically. However, that expansion came at the expense of Apria Healthcare Group’s and Apria Healthcare LLC’s conformity with the federally-funded health programs’ essential medical necessity requirement. Precisely, while Apria Healthcare Group and Apria Healthcare LLC understood that it was liable for monitoring patients’ usage of their non-invasive ventilators and to stop charging once non-invasive ventilators were no-longer being utilized, it did not have enough personnel, or respiratory therapists, to perform such monitoring. Subsequently, Apria Healthcare Group and Apria Healthcare LLC routinely charged Medicare and other health programs after it did not know if non-invasive ventilators were still being utilized by patients and, hence, remained medically needed. Besides, even after Apria Healthcare Group and Apria Healthcare LLC had information showing that patients were no longer utilizing their non-invasive ventilators, it frequently continued to charge federal health systems.
As also purported, Apria Healthcare Group and Apria Healthcare LLC participated in two other kinds of fraudulent practices to acquire more non-invasive orders and higher returns. First, Apria Healthcare Group and Apria Healthcare LLC fraudulently charged federally-funded health systems for specific non-invasive ventilator rentals that were being utilized in a setting known as PAC mode to give bi-level pressure support therapy, which was accessible from a less costly device called VPAP RAD and did not qualify for payment at the non-invasive ventilator rate. Second, Apria Healthcare Group and Apria Healthcare LLC inappropriately waived copays for several Medicare and TRICARE beneficiaries to persuade them to rent non-invasive ventilators. For instance, Apria Healthcare Group and Apria Healthcare LLC workers offered to waive copays to persuade patients to rent non-invasive ventilators from Apria Healthcare Group and Apria Healthcare LLC rather than competitors. Also, Apria Healthcare Group and Apria Healthcare LLC as well waived copays without making the needed individualized assessment of financial necessity. Because of those three widespread fraudulent practices, Apria Healthcare Group and Apria Healthcare LLC submitted thousands of fraudulent submissions to government health programs for non-invasive ventilator rentals and unlawfully obtained millions of U.S. dollars in payments.
As part of the settlement deal, Apria Healthcare Group and Apria Healthcare LLC acknowledged, confessed, and accepted liability for, among others, the following action;
Non-invasive Ventilators Continued Utilization Conduct
- Apria Healthcare Group and Apria Healthcare LLC depended on the respiratory therapists in its branches to monitor patients’ utilization of their non-invasive ventilator devices. Also, Apria Healthcare Group’s and Apria Healthcare LLC’s non-invasive ventilator advertising materials showed that their respiratory therapists would routinely visit non-invasive ventilators patients to evaluate if they utilized their non-invasive ventilators devices in compliance with their doctors’ instructions.
- However, the respiratory therapists at their branches frequently did not perform regular visits to non-invasive patients to validate that patients were utilizing their non-invasive ventilators as instructed by their doctors. An internal audit in January 2017, for instance, established that in December 2016, Apria Healthcare Group and Apria Healthcare LLC respiratory therapists did not complete over half of the visits to non-invasive patients required by Apria Healthcare Group and Apria Healthcare LLC non-invasive ventilators clinical procedures at each of its three operational branches.
- Apria Healthcare Group and Apria Healthcare LLC progressed to seek reimbursements from federally-funded health systems for non-invasive ventilators every month, although its respiratory therapists often did not perform in-home visits to confirm that patients were still utilizing their non-invasive ventilators.
- Besides, after it had information from respiratory visits showing that patients had stopped utilizing their ventilators, Apria Healthcare Group and Apria Healthcare LLC frequently failed to take measures to halt seeking reimbursements from federally-funded health programs or to establish if the ventilators rentals were still medically needed.
PAC Mode Behavior
- In 2015, Apria Healthcare Group and Apria Healthcare LLC motivated its sales personnel to actively urge doctors to order in PAC mode the Astral non-invasive ventilators. Once they urged doctors to order Astral non-invasive ventilators in PAC mode, their sales personnel often failed to inform the doctors that PAC mode therapy was as well accessible via the VPAP RAD at a lower monthly price.
- On numerous occasions, this led to Apria Healthcare Group and Apria Healthcare LLC renting the more costly Astral non-invasive ventilators to patients with the PAC mode therapy orders, including patients insured by government health programs, although the less costly VPAP RADs might have met the medical necessity of those patients.
Copay Waiver Behavior
- Directors at various Apria Healthcare Group and Apria Healthcare LLC branches instructed sales personnel at those to regularly discuss the copay waivers’ availability with non-invasive ventilators patients, like before the patients raised concerns concerning their ability to make these reimbursements. In several cases, those directors also permitted sales personnel to give copay waivers to convince patients to rent non-invasive ventilators rather than from other DME providers.
- During the covered duration, Apria Healthcare Group and Apria Healthcare LLC offered full copay waivers to numerous non-invasive ventilators patients without conducting an assessment if those patients could have afforded some percentage of their copay liabilities.
- Because of the confessed behavior, Apria Healthcare Group and Apria Healthcare LLC obtained payments from the government health programs for some non-invasive ventilators rental submissions that did not observe any of those programs’ billing guidance and rules.
In association with this resolution, Apria Healthcare Group and Apria Healthcare LLC further reached into a Corporate Integrity Agreement with HHS-OIG, which demanded Apria Healthcare Group and Apria Healthcare LLC to execute board monitoring, a claims review process by an Independent Review Organization, and other conformity steps created to promote observance to government health system requirements and thereby safeguard the programs.
This resolution resulted from a relator case filed by three previous Apria Healthcare Group and Apria Healthcare LLC workers under the False Claims Act’s qui tam provisions, which permits private persons, called whistleblowers, to lodge civil suits on U.S. behalf and share in the recovery.
The Acting United States Attorney Strauss applauded the Washington MFCU for its extensive partnership in the inquiry and settlement of this case and further applauded the remarkable investigative effort of the DCIS, OPM-OIG, and HHS-OIG.
The Office’s Civil Fraud Unit handled the case. U.S. Assistant Attorneys Steven Kochevar and Li Yu and previous U.S. Assistant Attorney Casey Lee prosecuted the case.
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