US joins lawsuit against defunct Arriva Medical

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Thursday, February 21, 2019

NASHVILLE, Tenn. – The U.S. Justice Department has joined in a lawsuit that alleges Arriva Medical offered Medicare beneficiaries “free upgrades” of glucometers.

The lawsuit, filed under the False Claims Act, also alleges that Arriva and its parent company, Alere, submitted false claims for medically unnecessary glucometers, and paid kickbacks to beneficiaries in the form of free glucometers and co-pay waivers.

Additionally, it alleges Arriva made no meaningful effort to collect co-pays from beneficiaries, a violation of the Anti-Kickback Statute.

“When medical equipment companies scheme to enrich themselves by unlawfully increasing the sales volume of durable medical equipment, they place our federal health care programs in jeopardy,” said Donald Cochran, U.S. Attorney for the Middle District of Tennessee. “The restrictions imposed by federal statutes exist to prevent improper practices, including providing unnecessary medical equipment and billing Medicare for it. We will continue to enforce the laws that protect the integrity of federal health care programs.”

The Coral Springs, Fla.-based Arriva, a mail-order diabetes testing supply company, ceased operations in December 2017 after losing an appeal seeking to reinstate its Medicare billing privileges. CMS revoked those privileges in 2016, alleging the provider submitted 211 claims for deceased patients between April 15, 2016, and April 25, 2016.

Prior to that, Arriva had been the top provider of mail-order diabetes supplies, receiving nearly $120 million in Medicare payments in 2015.

Arriva was acquired by Alere, a Waltham, Mass.-based medical device manufacturer, in 2011; both companies were acquired by Abbott Laboratories in 2017.