In brief: Rotech’s notification, DOJ’s fraud record, VGM’s CISO 

ORLANDO, Fla. – Rotech Healthcare on Feb. 23 provided notification of a recent privacy incident experienced by Philips Respironics that may have impacted certain information of patients who purchased Philips sleep and respiratory devices from Rotech. 

“Although Rotech is unaware of any misuse of information resulting from this event, we are providing this notice in an abundance of caution,” the company stated on its website. 

When reached for comment, a spokesman for Philips confirmed that an investigation by the company revealed that due to a security vulnerability in the MOVEit Transfer software, personal information was accessed by an unauthorized third party on May 31, 2023. The affected personal information may have included names, contact information, dates of birth, medical information related to the therapy delivered, and health insurance information. Philips says financial information, such as social security numbers or credit card information, was not included in the incident. 

Philips noted that the security vulnerability in the MOVEit Transfer software, which the company used to transfer patient files containing therapy data to health care providers, had a significant global impact, affecting hundreds of organizations worldwide. 

“Philips Respironics has already taken the appropriate measures to secure the systems,” the spokesman said. “We are informing affected customers and are available to assist them in their response to the security incident.” 

DOJ announces record number of settlements 

WASHINGTON – Settlements and judgments under the False Claims Act exceeded $2.68 billion in the fiscal year ended Sept. 30, 2023, the U.S. Department of Justice has announced. 

The government and whistleblowers were party to 543 settlements and judgments, the highest number in a single year, the DOJ says. 

“Protecting taxpayer dollars from fraud and abuse is of paramount importance to the Department of Justice – and these enforcement figures prove it,” said Acting Associate Attorney General Benjamin C. Mizer. “The False Claims Act remains one of our most important tools for rooting out fraud, ensuring that public funds are spent properly, and safeguarding critical government programs.” 

Recoveries since 1986, when Congress substantially strengthened the civil False Claims Act, now total more than $75 billion. 

Of the more than $2.68 billion in False Claims Act settlements and judgments reported by the DOJ this past fiscal year, more than $1.8 billion related to matters that involved the health care industry, including managed care providers, hospitals, pharmacies, laboratories, long-term acute care facilities, and physicians. The amounts included in the $1.8 billion reflect recoveries arising only from federal losses, but in many of these cases, the department was instrumental in recovering additional amounts for state Medicaid programs.   

Motion kicks off expos in April 

TORONTO – Motion, formerly Motion Specialties, has announced the return of its Motion Rehab Expo series in 2024. The company will hold expos in 12 communities across Alberta, British Columbia, Saskatchewan and Ontario, including Saskatoon and Oshawa for the first time. The expo comprises a full day of complimentary education and networking for health care and industry professionals in Canada, including therapists, long-term care administrators, funding providers and others. Attendees can expect 15- or 30-minute round-robin presentations from equipment manufacturers for adult and pediatric solutions, and product demos. They also can participate in continuing education presented by various guest speakers. The expos kick off on April 16 in Lethbridge, Alberta. For a listing of all dates and locations, go to motioncares.ca/events. 

Man charged in $97M brace scheme 

NEWARK, N.J. – A Florida man has been charged with an indictment unsealed on Feb. 21 for this role in a DME kickback scheme that caused $97 million in losses to Medicare, according to the U.S. Attorney’s Office of the District of New Jersey. Raheel Naviwala, 35, of Coral Springs, Fla., is charged in a 10-count indictment with one count of conspiracy to commit health care fraud and wire fraud, three counts of health care fraud, two counts of wire fraud, one count of conspiracy to violate the federal Anti-Kickback Statute, and three counts of illegal kickbacks. According to the indictment, Naviwala and his conspirators owned and operated multiple call centers through which they obtained doctors’ orders for orthotic braces for Medicare beneficiaries, without regard to medical necessity. He and his conspirators obtained the DME orders through the use of marketing call centers and telemedicine companies and provided these DME orders in exchange for bribes from certain companies of $125 to $450 per brace. Naviwala and his conspirators caused losses to Medicare in excess of $97 million and received kickbacks in excess of $46 million. The U.S. Attorney’s Office noted that the charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty. 

Palmetto Infusion names president 

COLUMBIA, S.C. – Palmetto Infusion, a provider of ambulatory and home infusion in the Southeast, has appointed Tim Hadley as its new president in a strategic move to bolster the company’s commitment to patient care. “Tim’s wealth of experience and dedication to health care align seamlessly with our mission,” said CEO David Goodall. “As we focus on industry-wide impact and shaping the company’s direction, I am confident that Tim will play a crucial role in driving our continued success and helping us to continue restoring health and hope to our patients.” Hadley has more than 20 years of executive experience in both public and private health care settings. Palmetto Infusion has more than 40 ambulatory infusion clinics across the Carolinas, Georgia, Alabama, Florida and Virginia. 

DarioHealth buys Twill 

NEW YORK – DarioHealth has acquired Twill in a move that the company says creates one of the most comprehensive digital offerings in the market for chronic conditions, spanning a wide spectrum of health and well-being needs. Dario says the deal also creates immediate scale, with three of the top eight national health plans, multiple Fortune 100 employers and several major pharmaceutical companies as customers. “The Twill acquisition is an incredible opportunity to bring together our complementary solutions and create an unrivaled platform for the next generation of consumer-centric digital health,” said Erez Raphael, CEO of Dario. “The addition of Twill instantly boosts revenue and margins, leveraging a robust SaaS-like model to fuel expected rapid growth and accelerating profitability. We are confident in our ability to integrate Twill and its employees and operations, as we have a track record of integrating previously acquired businesses.” Under the terms of the deal, Dario paid $10 million of cash and agreed to issue approximately 10 million shares of common stock in the form of pre-funded warrants for the benefit of Twill's debt holders and equity holders, vesting in four equal amounts at 270 days, 360 days, 540 days and 720 days, post deal closing. Concurrent with the deal, Dario priced a $22.4 million private placement of convertible preferred stock, priced at the market under NASDAQ rules, with participation from investors from both companies. Dario agreed to issue shares of newly designated convertible preferred stock to be sold at $1,000 per share, with conversion prices of $2.02 and $2.14, raising gross proceeds of $22.4 million. 

VGM names CISO 

WATERLOO, Iowa – VGM Group has announced Ryan Wood as its chief information security officer (CISO). Wood, who has more than 20 years of experience in cybersecurity and infrastructure management, most recently served as global director of IT security and systems engineering for Krause Group, which has more than 5,000 employees and multiple companies operating throughout the United States and the European Union. “I am thrilled to welcome Ryan to VGM Group,” said VGM Group CEO Jeremy Stolz. “Ryan brings decades of experience and an unmatched level of expertise, which perfectly aligns with VGM’s commitment to serving our customers and their increasingly complex needs. I look forward to having Ryan on the team as we continue to evolve and respond to the ever-changing security landscape, particularly in the healthcare sector.” Wood’s credentials include Certified Information Systems Security Professional (CISSP), Certified Information Security Manager (CISM), and Certified Cloud Security Professional (CCSP). At VGM, he will be responsible for overseeing the company’s information security and regulatory compliance initiatives and executing quality assurance and performance improvement (QAPI) and credentialing programs. 

Carewell raises $24.7M 

MIAMI – Carewell, an online retailer focused on providing family caregivers with tools and resources to care for their loved ones, has announced a $24.7 million Series B capital raise to accelerate its mission of streamlining access to home health products. The raise was led by the principals of MBF Healthcare, with participation from existing investors Sageview Capital and Headline, among others. “Family caregiving is becoming an increasingly more common experience in the U.S. with spouses, children, parents and even grandchildren having to take on a caregiving role overnight without warning,” said Bianca Padilla, CEO and founder of Carewell. “Understandably, these individuals can experience significant mental, physical and emotional stress as they balance their role as caregivers with other responsibilities to work and family, and our mission at Carewell is to help educate, support and advocate for these selfless heroes.” Carewell has also announced several senior level hires amid its plans to relocate its headquarters to Miami. The company has named Mike Pacifico as CFO, Jason Klinghoffer as chief marketing officer, Sam Rassner as chief technology officer and Kelli Durkin as vice president of customer service – all formerly of Chewy. “Mike, Jason, Sam, and Kelli all bring significant e-commerce industry experience and a strong track record of working together from their time at Chewy.com,” Padilla said. “Their addition reaffirms our commitment to providing affordable health care solutions for caregivers, and we are thrilled to welcome them into the Carewell family.” Additional investors in the raise included Primetime Partners, Nextview, Florida Opportunity Fund, and Anchor.