Medical Equipment Company Handicare USA, LLC, Agrees to Pay $800,000 to Resolve False Claims Act Action
WASHINGTON – On August 17, 2020 Handicare USA (doing business as Prism Medical Services), agreed to pay the United States $800,000 to resolve allegations that it knowingly submitted false claims to the Department of Veteran Affairs (“VA”) in the performance of various contracts to install patient ceiling lifts in VA hospitals.
Handicare USA manufactures and installs patient lift and mobility systems for hospitals and rehabilitation centers. Handicare USA entered into various contracts with the VA to install patient ceiling lifts in VA hospitals and other VA medical or health care facilities. The VA contracts specifically required that all parts and products must be compliant with the Trade Agreements Act, a statute that provides that the government may acquire only products made within the United States or from “designated” countries who abide by certain trade laws with the United States. Handicare USA knew of the importance of this requirement and submitted a certification at the time of contracting that every part installed was “made in the United States,” and further submitted engineering certifications that the parts installed were from a manufacturer who manufactured and sold only American-made products.
Based on a tip from a whistleblower, an agent from the VA Office of the Inspector General inspected the patient lift systems of several VA hospitals and found that Handicare USA used inferior and cheaper parts made in China, a non-designated country, for the mounting system that secured the patient lift to the ceiling. Even more, the Office of the Inspector General learned that Handicare USA supervisors at the project sight specifically instructed personnel to install the parts so that the “Made in China” stamps on the metal parts would be against the building bulkheads or otherwise not visible for inspection.
“The VA Office of Inspector General tirelessly pursues fraud, waste, and abuse affecting VA, and will continue to work with our law enforcement partners to hold violators accountable,” said VA Inspector General Michael J. Missal. “The use of inferior products that can put veterans, staff, and visitors to VA medical facilities at risk will not be tolerated. Our nation’s veterans, families and VA staff deserve the highest standards of integrity, professionalism, and accountability from government contractors.”
“This agreement demonstrates our resolve to hold accountable any organization that mishandles federal funds intended for the benefit of our veterans. Handicare was entrusted to provide vital medical equipment of the highest quality and safety, utilizing manufacturers in the United States. That trust was violated when Handicare falsely claimed that the parts were manufactured in the United States, and instead used lower quality hardware” said Acting United States Attorney Michael R. Sherwin.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
The investigation in this matter was conducted by Special Agent Christopher Holcombe of the Department of Veteran’s Affairs Office of the Inspector General and Assistant United States Attorney Darrell Valdez of the United States Attorney’s Office for the District of Columbia.