The Pacific Pulmonary Services lawsuit was a federal whistleblower case that ended in April 2017, when the California-based home oxygen and sleep therapy supplier agreed to pay $11.4 million to resolve allegations it had billed Medicare and other government health programs for equipment delivered without required physician authorizations and had run a cross-referral kickback arrangement with sleep-testing clinics.1U.S. Department of Justice. Oxygen Equipment Provider Pays $11.4 Million to Resolve False Claims Act Allegations The company did not admit wrongdoing.2HME News. Pacific Pulmonary Settles $11.4M
What the Company Was Accused of Doing
The federal case, brought under the False Claims Act, covered conduct running from roughly 2004 through the end of 2015 and centered on two separate schemes.3Press Democrat. Home Oxygen Company to Pay $11.4 Million to Settle Fraud Charges
Oxygen Equipment Billed Without Physician Authorization
Beginning around 2004, the Department of Justice alleged, Pacific Pulmonary submitted claims to Medicare, TRICARE, and Federal Employee Health Benefits programs for home oxygen and related equipment before obtaining the physician authorizations those programs require.1U.S. Department of Justice. Oxygen Equipment Provider Pays $11.4 Million to Resolve False Claims Act Allegations According to the whistleblower’s complaint, the company arranged equipment delivery first and then chased down a doctor’s signature afterward.4SFGate. Novato Oxygen Equipment Supplier Pays $11.4 Million in Fraud Charges Settlement
Kickback Arrangement With Sleep Clinics
Starting in 2006, according to the government, certain Pacific Pulmonary patient care coordinators had a quid pro quo with sleep-testing clinics. Coordinators sent patients to the clinics for obstructive sleep apnea testing, and the clinics sent those same patients back to Pacific Pulmonary for CPAP and BiPAP masks, supplies, and other sleep therapy equipment.1U.S. Department of Justice. Oxygen Equipment Provider Pays $11.4 Million to Resolve False Claims Act Allegations The clinics involved were primarily in Northern California’s East Bay.4SFGate. Novato Oxygen Equipment Supplier Pays $11.4 Million in Fraud Charges Settlement The government said the arrangement violated the federal Anti-Kickback Statute, which bars offering or receiving anything of value in exchange for referrals of patients whose care is paid for by federal health programs.5HHS Office of Inspector General. Fraud and Abuse Laws
Who Brought the Case
The lawsuit was filed in 2010 by Manuel Alcaine, a former Pacific Pulmonary sales representative, in the U.S. District Court for the Northern District of California. He sued under the qui tam provisions of the False Claims Act, which let private whistleblowers sue on behalf of the United States and share in any recovery. The case was captioned United States ex rel. Alcaine v. Braden Partners, L.P., dba Pacific Pulmonary Services, et al., No. 10-cv-4597. The federal government later intervened and took over the prosecution.1U.S. Department of Justice. Oxygen Equipment Provider Pays $11.4 Million to Resolve False Claims Act Allegations
The named defendants were Braden Partners, L.P., which did business as Pacific Pulmonary Services from its headquarters in Novato, California, and Teijin Pharma USA LLC, a Delaware subsidiary of Japan-based Teijin Ltd. that served as Braden’s general partner.3Press Democrat. Home Oxygen Company to Pay $11.4 Million to Settle Fraud Charges At its peak, the company served about 150,000 patients through more than 100 outlets in 20 states.6HME News. FBI Raids Pacific Pulmonary
The 2012 FBI Raid
In early 2012, about two years after Alcaine filed his complaint, FBI agents raided Pacific Pulmonary offices in California, including billing, reimbursement, and sleep therapy centers in Bakersfield.2HME News. Pacific Pulmonary Settles $11.4M
The Settlement
On April 25, 2017, Braden Partners and Teijin Pharma USA agreed to pay $11.4 million to resolve the False Claims Act allegations.7HHS Office of Inspector General. Oxygen Equipment Provider Pays $11.4 Million to Resolve False Claims Act Allegations The settlement agreement stated there was no determination of liability, and the company did not admit wrongdoing.2HME News. Pacific Pulmonary Settles $11.4M
Alcaine received $1.824 million as his whistleblower share.8U.S. Department of Justice. Oxygen Equipment Provider Pays $11.4 Million to Resolve False Claims Act Allegations
As part of the resolution, Pacific Pulmonary signed a five-year corporate integrity agreement with the HHS Office of Inspector General, running from March 31, 2017 through January 12, 2023. Such agreements impose compliance, reporting, and monitoring obligations on healthcare companies that settle federal fraud allegations.9HHS Office of Inspector General. Braden Partners LP Doing Business as Pacific Pulmonary Services
What Happened to the Company
Roughly a year after the settlement, on May 17, 2018, Pacific Pulmonary Services was acquired by AdaptHealth, a national home medical equipment provider.10PitchBook. Pacific Pulmonary Services Company Profile Industry records and employee reviews indicate the Pacific Pulmonary brand did not continue operating independently after the acquisition.11Indeed. Pacific Pulmonary Services Reviews
Not to Be Confused With Pacific Pulmonary Medical Group
A separate, unrelated Riverside, California pulmonary practice called Pacific Pulmonary Medical Group has also appeared in legal news, but for a different reason: an October 2024 data breach in which an unauthorized party compromised employee credentials for a third-party scheduling system and accessed patient names and Social Security numbers.12California Attorney General. Pacific Pulmonary Medical Group Breach Notification The ransomware group “Everest Team” claimed responsibility, and exposed records reportedly spanned 2021 to 2024. As of early 2025, law firms were investigating potential class claims, but no lawsuit had been filed.13ClassAction.org. Pacific Pulmonary Medical Group Data Breach The medical group has no corporate connection to Braden Partners, Teijin Pharma USA, or the former Pacific Pulmonary Services operation in Novato.