Hearing Aid Company Agrees To Pay $34.37 Million To Settle Claims That It Submitted False Claims to the Federal Employees Health Benefits Program

Hearing Aid Company Agrees To Pay $34.37 Million To Settle Claims That It Submitted False Claims to the Federal Employees Health Benefits Program

On Friday, April 29th, DOJ announced a $34.37 million settlement with Eargo Inc., a California company that sells and dispenses hearing aids, relating to allegations that Eargo submitted false claims for reimbursement to the Federal Employees Health Benefits Program (FEHBP). FEHBP — the largest employer-sponsored health insurance program in the world — is administered by the U.S. Office of Personnel Management and provides health benefits to eight million current and former federal employees and their families through various health insurance providers.

According to the government, Eargo submitted or caused the submission of claims for reimbursements to FEHBP for hearing aids between January 1st, 2017, and January 31st, 2021, which included unsupported diagnosis codes. Eargo also allegedly provided invoices to FEHBP beneficiaries that the beneficiaries, in turn, used to obtain reimbursement from FEHBP, reflecting unsupported hearing-loss-related diagnostic codes. In addition, the government alleged that Eargo knowingly used unsupported hearing-loss-related diagnostic codes between February 1st, 2021, and September 22nd, 2021, even after Eargo completed an internal review of its billing and coding practices in January 2021.

The DOJ press release is here.

DOJ Brings FCA Claims Against Maryland Contractor for Improper Steering

The Department of Justice announced on Tuesday, May 3rd, that it has filed a False Claims Act lawsuit against Intelligent Fiscal Optimal Solutions LLC (iFOS) and its owner, alleging that iFOS coordinated with a Department of Homeland Security (DHS) official to steer the award of a contract for staff augmentation services. According to the complaint, iFOS worked with DHS official Kenneth Buck to secure the contract prior to his departure, with plans for Buck to serve as iFOS’ Strategic Advisor for the contract following his departure. Federal conflict-of-interest rules require a mandatory “cooling off” period for certain former government officials, including Buck. During the “cooling off” period, Buck was prohibited from communicating directly with DHS officials on behalf of iFOS. iFOS allegedly concealed Buck’s involvement and falsely represented to DHS that another iFOS employee would serve as Strategic Advisor.  

The government also alleges that iFOS submitted falsified invoices to DHS, concealing the extensive work performed by Buck. According to the DOJ, Buck settled civil claims relating to his role in the alleged scheme earlier this month.

The DOJ press release is here.