A Canoga Park-based company that sells home medical equipment has paid $565,873 to resolve allegations that it knowingly submitted false claims to federal health care programs for medically unnecessary medical supplies and those never delivered to patients, it was announced Wednesday.
Valley Home Medical Supply Inc. paid the settlement Tuesday as part of an agreement that resolves a whistleblower lawsuit that alleged the company defrauded the Medicare and TRICARE programs from July 2006 until May 2013, according to the U.S. Attorney’s Office.
With the payment of the settlement, U.S. District Judge Dale S. Fischer dismissed the suit. Valley Home’s former president and chief executive officer, Kenneth Greenlinger, 75, of Oxnard, pleaded guilty in May 2017 to two counts of health care fraud and served an eight-month federal prison sentence. In the criminal case, Greenlinger was ordered to pay restitution of over $1 million.
Kari Kitamura, a former employee of Valley Home, filed the civil lawsuit in 2012 in Los Angeles federal court, and the government elected to intervene five years later.
Kitamura filed the suit under the whistleblower provisions of the False Claims Act, which permit private parties to sue on behalf of the United States and to receive a share of any recovery. As a result of the settlement, Kitamura will receive $124,492, which equals 22 percent of the settlement proceeds. Valley Home Medical Supply will also pay Kitamura $80,000 for attorney’s fees, according to prosecutors.
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