Wound Care Giant, False Claims, California 2022

A Florida-based wound care giant, Healogics Inc., has agreed to pay up to $22.51 million to settle allegations that it knowingly caused wound care centers to bill Medicare for medically unnecessary and unreasonable hyperbaric oxygen therapy.

According to the Justice Department, Healogics, which manages nearly 700 hospital-based wound care centers across the country, submitted false claims to Medicare for HBO therapy from 2010 through 2015.

“Medicare beneficiaries are entitled to care based on their clinical needs and not the financial goals of healthcare providers,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “All providers of taxpayer-funded federal healthcare services, whether contractors or direct billers, will be held accountable when their actions knowingly cause false claims for medically unnecessary services to be submitted.”

The settlement, which resolves allegations in two whistleblower lawsuits, includes a payment of $17.5 million, plus 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.

Healogics has also entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General, which includes a claims review and a systems review to be conducted by an Independent Review Organization.

The whistleblower share of the settlement is up to $4,276,900. The settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the United States Attorney’s Office for the Middle District of Florida, and the Department of Health and Human Services Office of Inspector General.

The cases are captioned United States ex rel. Van Raalte, et al. v. Healogics, Inc., 14-cv-283 (M.D. Fla.) and United States ex rel. Wilcox. v. Healogics, Inc., et al., 15-cv-1510 (M.D. Fla.).

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