ResMed Corp. to Pay the United States $37.5 Million to Settle Allegations Under the False Claims Act

(STL.News) – Acting United States Attorney A. Lance Crick announced today that ResMed Corp., a manufacturer of durable medical equipment (DME) for sleep apnea and other sleep-related disorders, has agreed to pay more than $37.5 million to resolve allegations under the False Claims Act for paying kickbacks to DME suppliers, sleep labs, and other health care providers.

The settlement resolves allegations that ResMed used various sales and promotional schemes to unlawfully induce the sales of ResMed equipment.  The schemes included providing free call center services and free and below cost masks and machines.

“Health care decisions should be based on what is in the best interest of the patient, and not on financial incentives and related schemes,” said Acting U.S. Attorney Crick. “This settlement represents another example of our district’s commitment to prosecuting schemes that undermine the integrity of our nation’s health care system.”

The settlement resolves five lawsuits originally brought by whistleblowers under the False Claims Act.  The False Claims Act permits private citizens with knowledge of fraud against the government to bring a lawsuit on behalf of the United States and to share in the recovery.  The whistleblowers will collectively receive a roughly $6.2 million share of the settlement.

This settlement was the result of a coordinated effort by the Civil Division of the United States Department of Justice; the U.S. Attorney’s Offices for the District of South Carolina, the Southern District of California, the Northern District of Iowa, and the Eastern District of New York; the Department of Health and Human Services, Office of Counsel to the Inspector General and Office of Investigations; the Defense Criminal Investigative Service; the Defense Health Agency Office of General Counsel; the Federal Bureau of Investigation, and the National Association of Medicaid Fraud Control Units.

Former Assistant United States Attorney Jennifer Aldrich investigated this case on behalf of the District of South Carolina.  Assistant United States Attorneys Tina Cundari and James Leventis assisted on the case.

The claims resolved are allegations only.  There has been no determination of liability.

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