A breast pump sits in front of a server rack at Yokota Air Base, Japan, in 2020. A U.S. company that federal prosecutors said overcharged Tricare for breast pumps agreed to a $1 million settlement in the case. (Taylor A. Workman/U.S. Air Force)
A Pennsylvania company will pay $1 million to settle allegations that it overcharged Tricare for breast pumps and related equipment, according to the Justice Department.
The company, Scottie Girl, which was also doing business as the Breastfeeding Shop in Emmaus, Pa., exploited a new benefit rolled out by the military insurance provider in 2015 to provide breast pumps for nursing mothers, a DOJ statement Monday said.
During the early years of the new benefit, the business billed Tricare hundreds of dollars more per breast pump than it charged the state Medicaid program, thereby using a banned “dual fee schedule,” the Justice Department said.
Prosecutors also accused the shop of engaging in prohibited “unbundling,” taking apart pre-packaged kits and billing Tricare separately for each item as a replacement part.
“Fraud involving Tricare ... is something we take seriously and will investigate fully,” said Christopher Silvestro, the acting special agent in charge of the Defense Criminal Investigative Service’s Northeast field office.
Tricare scaled back its coverage of breast pumps in 2019 after a government watchdog agency found that it had overpaid more than $16 million for the equipment.
That report, from the Office of Inspector General, found that the Defense Health Agency overpaid for breast pumps in 91% of cases in 2016.
The claims resolved by the settlement are allegations only and there has been no determination of liability, the Justice Department said in the statement.
