Lincare to Pay $12 Million to Settle Kickback, Stark Investigations

CLEARWATER, Fla.–Respiratory giant Lincare Holdings has agreed
to pay more than $12 million to settle ongoing kickback and
reimbursement allegations, the provider said.

As a result of four long-standing investigations by the Health
and Human Services Office of Inspector General and the U.S.
Department of Justice, federal officials alleged that the company
paid illegal kickbacks for patient referrals. The company also was
accused of violating the physician self-referral (Stark) law.

Without admitting any wrongdoing, Lincare reached a $10
settlement with the OIG, which said that it was the largest-ever
civil monetary penalty by the agency.

In the first investigation, OIG alleged that from 1993 to 2000
Lincare engaged in a nationwide scheme to pay physicians kickbacks
to refer their patients to the company and gave referring
physicians items like sporting and entertainment tickets, gift
certificates, rounds of golf, golf equipment, fishing trips, meals,
advertising expenses, office equipment and medical equipment. The
kickbacks were disguised as payments for supposed consulting
agreements, such as medical director agreements, OIG said. OIG also
alleged that Lincare violated the physician self-referral aw by
accepting referrals from parties to the illegal consulting
agreements.

Three additional investigations, conducted separately in
Massachusetts, Tennessee and Idaho, involved allegations that, in
periods ranging from 1995 through 2004, Lincare inappropriately
sought reimbursement under Medicare and other government health
care programs, or otherwise violated federal health care laws.

“Lincare fully cooperated with the government during the course
of their inquiries,” Chairman and CEO John P. Byrnes said in a
press release. “Our board of directors believes that it was in the
best interests of the company to put these matters behind us.”

The company said it has reserved a substantial portion of the
settlement charges and related expenses.

As a part of the settlements, Lincare has entered into five-year
a corporate integrity agreement with the OIG.