Novato Company To Pay $11.4M In Whistleblower Lawsuit

MARIN COUNTY, CA -- A Novato-based medical equipment supplier has agreed to pay $11.4 million to resolve allegations that it submitted false claims to Medicare and other federal healthcare programs, the U.S. Justice Department announced this week.

The supplier, Pacific Pulmonary Services, provides oxygen tanks, related supplies and sleep therapy equipment.

Pacific Pulmonary Services is the business name of Braden Partners LP and Teijin Pharma USA LLC, according to court documents.

While agreeing to the payment, the company does not admit in the settlement to any wrongdoing.

The fraud allegations were made in a so-called whistleblower lawsuit filed under the U.S. False Claims Act in 2010 by a former sales representative, Manuel Alcaine, who worked in the company's San Leandro office from March 2009 to January 2010.

Later, the U.S. government joined the lawsuit and took over handling it.

The lawsuit alleged that beginning in 2004, Pacific Pulmonary began submitting claims to Medicare and other programs for home oxygen and oxygen equipment without obtaining the required authorization from a doctor.

It also alleged that beginning in 2006, some sales representatives began referring patients to sleep clinics in exchange for the clinics' referring the patients back to Pacific Pulmonary to buy or rent equipment.

In accordance with the False Claims Act, Alcaine will receive $1,824,000 of the $11.4 million to be paid by Pacific Pulmonary.

By Bay City News Service

Image via Shutterstock