California Nursing Home Chain Agrees To Pay $28.5M To Settle False Claims Allegations

162017_132140396847214_292624_nThe U.S. Department of Justice announced on September 19, 2016 that a California-based, for-profit operator of 35 skilled nursing facilities (nursing homes), most of which are in California, has agreed to pay the government $28.5 million in order to settle allegations that it violated the federal False Claims Act by causing the submission of false claims to government health care programs for medically unnecessary rehabilitation therapy services provided to residents at its skilled nursing facilities.

The federal government alleged that the company, which provides nursing home residents with inpatient rehabilitation services, including physical, occupational, and speech therapy, caused false claims to be submitted to Medicare and TRICARE for all of its facilities from January 21, 2005 to October 31, 2009, and continued its improper billing at three of its California nursing homes from November 1, 2009 to December 3, 2011.

The Senior Vice President of Reimbursement Analysis for the company is alleged to have contributed to the wrongful conduct by creating the improper billing scheme, and the chairman of the board of the company is alleged to have reinforced the improper billing scheme at the company’s nursing homes. The chairman of the board of the private company has agreed to pay $1 million, and the Senior Vice President of Reimbursement Analysis of the company has agreed to pay $500,000, to resolve the allegations involving them, in addition to the $28.5 million that the company has agreed to pay to resolve the false claims allegations against it.

In addition to the payment made to the federal government, the company has entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG. The CIA applies to all facilities managed by the company and requires an independent review organization to annually review therapy services billed to Medicare.

In announcing the settlement, the U.S. Attorney for the Northern District of California stated, “This office is committed to safeguarding the federal health care programs and the patients who are enrolled in them. Skilled nursing facilities such as [the company] treat some of the most vulnerable patients in the health care system. These facilities, and the individuals who run them, will be held accountable when they provide treatment based on financial motivations instead of the patients’ needs.”

The U.S. Department of Justice’s announcement concerning the company and its upper management’s resolution of the false claims allegations noted that the claims resolved by the settlements are allegations only and there has been no determination of liability.

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Health Care Fraud Involving Nursing Homes Is Running Rampant Nationwide

On September 8, 2016, the U.S. Department of Justice announced that a Florida doctor was indicted for his alleged participation in a $13.8 million Medicare fraud scheme that allegedly involved him signing fraudulent medical records while he was the medical director of four Orlando, Florida clinics, authorizing the unnecessary treatment of Medicare beneficiaries, and did so without examining the Medicare beneficiaries or the documents themselves, conspiring with one of the clinics’ owners from approximately July 2008 through December 2011 to defraud Medicare by causing the submission and concealment of false and fraudulent claims to Medicare (the documents were allegedly used to support fraudulent claims to Medicare for expensive prescription drugs and physical therapy that were not provided and were not medically necessary).

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On September 7, 2016, the U.S. Department of Justice announced that two clinical psychologists pleaded guilty for their alleged involvement in a fraudulent psychological testing scheme that preyed upon Medicare recipients living in nursing homes throughout the Southeastern United States. The two clinical psychologists each pleaded guilty to one count of conspiracy to commit health care fraud involving their administering psychological tests to nursing home residents, for which a large number of the tests were not medically necessary and many testing services were not provided. According to their plea agreements, they repeatedly tested the same nursing home residents even though some were incapacitated and could not meaningfully participate in testing.

The two clinical psychologists were responsible for more than $5.6 million in fraudulent claims submitted to Medicare, according to their plea agreements. They worked for two companies that allegedly submitted more than $25.2 million in claims to Medicare from 2009 through 2015. The owners of the two companies have been indicted and are scheduled to begin trial on October 11, 2016.

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If you have knowledge of possible Medicare fraud in your U.S. state that has cost the Medicare or Medicaid health care programs money and you become a whistleblower, your information and efforts in assisting the U.S. government to recover the illegal payments may entitle you to monetary compensation.

Visit our website or call us toll-free in the United States at 800-295-3959 to find whistleblower lawyers in your state who may investigate your whistleblower claim for you and represent your interest in a whistleblower matter that may result in you receiving monetary compensation, if appropriate.

Turn to us when you don’t know where to turn.

This entry was posted on Wednesday, September 28th, 2016 at 5:20 am. Both comments and pings are currently closed.

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