Apria Agrees to Settle Medicare Fraud Charges

Ending nearly eight years of legal wrangling, Apria Healthcare Group Inc. said late Tuesday that it had preliminarily agreed to pay the government $17.6 million, without admission of wrongdoing, to settle Medicare fraud allegations.

Lake Forest-based Apria, one of the nation’s largest providers of home healthcare services, was the subject of a privately filed whistle-blower lawsuit in 1997 alleging Medicare overbilling.

Apria maintained that only “errors and omissions” occurred in its billing, but federal prosecutors had alleged more serious misconduct during the period from mid-1995 to 1998 and said in 2001 that they were seeking a $400-million settlement.

“We are pleased that we have been able to reach an acceptable compromise with the government concerning our billing documentation and record keeping,” Apria Chief Executive Larry M. Higby said in a statement.

Apria announced the settlement after the close of markets. Its shares rose 23 cents to $34.90 in regular trading.

In June, executives at Apria, with $1.5 billion in annual sales, said they were considering selling the firm and had hired investment banker Morgan Stanley to evaluate possible offers.