Lincare: Billing Medicare Advantage Beyond the Payment Cap

The Lincare Medicare Advantage oxygen settlement resolved claims of oxygen-rental overbilling for $29 million. Lincare admitted improperly charging traditional Medicare, Medicare Advantage plans and patients after the rental payment limit. Employees had raised concerns. Officials in regional billing and at corporate headquarters told them the billing would continue.

The Department of Justice announced the settlement on August 28, 2023. The corrective measures included returning improper patient copays and changing the billing operation.

Lincare supplies oxygen equipment to people with respiratory ailments, including chronic obstructive pulmonary disease. Its business includes leasing oxygen tanks and home and portable oxygen concentrators, so patients can use oxygen at home or while traveling. The Florida company is a wholly owned subsidiary of Linde plc. The case concerned what happened to those rental bills after the equipment had already been paid for.

The Oxygen Equipment Stayed After the Rental Payments Ended

The oxygen-equipment rental cap limited payments to 36 months. The supplier then had to keep providing the equipment.

In its account of traditional Medicare Part B from 2012 through 2023, the Justice Department explained why: after three years of monthly lease payments, Medicare had reimbursed the supplier for the equipment’s full purchase price. The patient could still need the equipment, but the supplier was no longer eligible for additional rental payments.

Many Medicare Advantage plans adopted the same limit between 2016 and 2023. Under the rule described in the settlement announcement, Lincare had to keep providing equipment for the remainder of its useful life after reaching the cap. It could no longer charge those plans rent or charge beneficiaries copays.

The equipment was paid for, and Lincare kept sending the bill. For patients, that meant money coming out of their own pockets as well as improper charges to the program or their health plan.

Billing Controls Failed, and Employees Raised Concerns

Lincare admitted different control failures for different payers. For traditional Medicare, it had controls designed to prevent improper billing, but they did not always work. For Medicare Advantage plans and beneficiaries, it lacked adequate controls to prevent charges after the rental cap.

For an insider, the payer attached to an account helps explain how the charge got through.

The admissions that accompany a settlement can explain more than the payment. Here, the Justice Department identified the offices behind the decision to keep billing:

Patients kept paying after employees had questioned the bills. The admissions put responsibility for continuing that practice at the billing office and headquarters.

The controls and the warnings also explain why different employees could hold different parts of the same story. Someone who knew the payment history could see the cap had been reached. Someone who handled the concern could know what management was told and how it answered. Together, those views explain both the continued charge and the decision behind it.

Medicare Advantage Plans Had Their Own Payment Terms

Medicare Advantage plans could set their own reimbursement and beneficiary copay rules, even though they had to provide the same coverage and benefits as traditional Medicare. The Justice Department specifically described many plans adopting the rental limit during the period at issue. The applicable plan terms therefore belong beside the payment history in an oxygen-billing case.

Diagnosis-driven risk adjustment fraud concerns the information used to increase an insurer’s payment. Lincare’s admissions concern what a supplier collected from the insurer and patient after the rental limit. The billing history carries the central evidence here.

Former Employees Brought the Lincare Whistleblower Case

Two former employees of Lincare’s center in Libby, Montana, brought a qui tam case under the False Claims Act. The government joined the case and subsequently reached the settlement.

The two former employees’ announced whistleblower share was $5.7 million from that settlement.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. In Lincare’s case, the people who brought the information forward had worked at a local center. Knowledge from that part of the business helped expose billing conduct whose admitted decision-making reached headquarters.

Refunds, Billing Software and Independent Review

Lincare committed to identifying and repaying beneficiaries from whom it had improperly collected copays, alongside refunding Medicare overpayments.

The company also entered a five-year corporate integrity agreement with the Office of Inspector General. It required a compliance and reporting program, significant billing reforms and independent experts, paid by Lincare, to review its claims and billing practices.

The settlement announcement further reported that Lincare had designed and implemented new billing software and other reforms.

For someone working in healthcare billing or compliance, the corrective measures point back to the original failure: the money already collected, the system producing new charges and the review of those charges.

Another Lincare Case Turned on Bills That Kept Coming

In a separate ventilator settlement announced in February 2024, Lincare agreed to pay $25.5 million over different respiratory equipment. It admitted that, in some instances, it kept seeking monthly payments from federal health care programs while aware that patients were not using the devices.

The oxygen case concerned a rental cap. The ventilator case concerned continued use and need. Both connect recurring rental bills to information inside Lincare that should have stopped them. An employee who knew the equipment’s payment or usage history could see something that the next monthly bill did not reveal.

What an Oxygen-Billing Insider Can Show

An oxygen-rental case connects the account history to the company’s decisions. The plan terms show the applicable limit. The payment history shows when that limit was reached. The later rental charges and patient copays show what the supplier continued to collect.

Lincare’s admissions add the management response to that picture. An employee’s concern, the information sent with it and the instruction that came back can explain why billing continued. For our whistleblower experts, that connection is central: what the business had been told, who answered and what happened to the charges afterward.

The corrective side can matter as well. An insider may know how a billing-software change handled capped accounts, whether a review covered the affected payers or how the company identified patient copays for repayment. Those details connect a promised reform to the accounts it was supposed to fix.

Lincare shows why information from a local operation can matter to a case involving decisions made much farther up the company. An account-level view can connect what the supplier collected to what its billing leadership had already been told.

When You Know Why the Bills Continued

If you worked with oxygen-rental accounts or saw employee warnings answered with instructions to keep billing, speak with our whistleblower experts. We build the case with you around the payment history and the decisions you can explain, bringing in durable medical equipment whistleblower lawyers who understand Medicare and Medicare Advantage billing. We stay with you through the whole journey to build your strongest oxygen-billing whistleblower case.