National provider Healogics wounded by two FCA settlements

What's worse than one False Claims Act settlement? How about two False Claim Act settlements?

 

Healogics, a national wound care provider based in Florida, will pay almost $18 million to resolve two separate False Claims Act allegations, and the total settlement could rise to more than $23 million according to two Department of Justice press releases issued June 20.

 

A relatively small payment of $398,162.69 will resolve allegations that Healogics improperly used modifier 25 (Significant, separately identifiable Evaluation and Management service by the same physician on the same day of the procedure or other service), the U.S. Attorney’s Office (USAO) for the Northern District of Iowa announced.

 

“Specifically," says the DONJ release, "the United States alleged that, from January 1, 2012, through June 30, 2017, Healogics submitted claims to Medicare, Medicaid, and Tricare using modifier 25 to signify that a separate evaluation and management service was performed on the same date as another procedure when no such separate service was performed.”

 

On top of that settlement, Healogics will pay $48,694.37 in legal fees to the law firm that represented the whistleblower, a coder who had worked for a medical center where Healogics provided wound care services who initially raised the allegations. The whistleblower will receive $91,577.42 of the settlement.

 

The second, much more expensive settlement began as two qui tam cases brought by four individuals: a former employee director for research and quality affairs for Healogics, and two doctors and a program director who worked at wound care centers affiliated with Healogics. “The settlement provides for a whistleblower share of up to $4,276,900,” the USAO for the Middle District of Florida announced in its press release.

 

The $17.5 million payment will settle allegations that “from 2010 through 2015, Healogics knowingly submitted or caused the submission of false claims to Medicare for medically unnecessary or unreasonable HBO therapy.”

 

And this might not be the last time Healogics writes a check to the government. “The provider agreed to pay an additional $5.01 million if certain financial contingencies occur within the next five years, for a total potential payment of up to $22.51 million.”

 

The press release doesn’t provide any details about the financial contingencies, but they may be contained in the yet-to-be-posted corporate integrity agreement that Healogics entered into with the HHS Office of Inspector General.