WASHINGTON, D.C. (Legal Newsline) — The U.S. Department of Justice announced April 12 that Rotech Healthcare Inc., a supplier of respiratory equipment with headquarters in Florida, will pay $9.68 million after allegations it knowingly submitted false claims for portable oxygen containers to Medicare.

“This settlement serves as a warning to suppliers who bill first and ask questions later,” acting assistant attorney general Chad A. Readler, head of the Justice Department’s Civil Division, said in a statement. “We will investigate and take action against companies who cut corners and place profits over compliance with Medicare’s billing requirements.”

According to the Justice Department, Rotech automatically billed Medicare for portable oxygen containers for all Medicare beneficiaries between January 2009 and March 2012, even after the 36-month rental period that Medicare normally covers. After 36 months, Medicare mandates that suppliers bill monthly for the product but only if the suppliers verify that the beneficiaries truly need it. Rotech allegedly never obtained the requisite proof. 

“Many people believe that health care fraud is a victimless crime; I assure you it is not,” U.S. attorney Joseph D. Brown of the Eastern District of Texas said in a statement. “Medicare is funded largely by you and me, the American taxpayers, and fraud contributes to runaway health care costs.  I commend the whistleblower who had the courage to come forward and who worked with investigators to get to the bottom of this case. Because of her, we were able to recoup millions of dollars improperly paid to Rotech.”

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