Largest therapy provider in the nation settles False Claims Act allegations for $125 million

posted on:
January 31, 2016

author:
Lance Gould

The Department of Justice (DOJ) announced Jan. 12 that Kindred Healthcare Inc. and RehabCare Group Inc. (collectively RehabCare) have agreed to pay $125 million to resolve False Claims Act (FCA) allegations. RehabCare contracts with more than 1,000 skilled nursing facilities in 44 states, which makes them the largest therapy provider in the nation.

The government alleged that RehabCare was submitting false claims to Medicare. These false claims were for services that were either unreasonable or did not even occur.

In the complaint against RehabCare, the government alleged that RehabCare was instigating procedures that triggered the submission of inflated bills to Medicare. These procedures included scheduling therapy to patients even after the therapist had recommended the patient be discharged from therapy; reporting time spent on evaluations as therapy time instead of evaluation time; and reporting that skilled therapy had been provided to patients when the patients were, in fact, asleep.

Inspector General Daniel Levinson stated that, “Health providers seeking to increase Medicare profits, rather than providing suitable, high-quality care, will be investigated and prosecuted.”

Health care providers ought to keep the clinical needs of their patients above the health care provider’s fiscal interest and when these providers submit false claims to Medicare, they prevent Medicare beneficiaries from receiving the care they’re entitled to receive. This is because when health care providers submit false claims for Medicare, tax money set aside for health care is not properly being spent on health care.

The government is actively combating health care fraud and, in its war, the government has found the FCA to be a powerful tool. The FCA helps the government detect, correct and deter fraud.

The FCA has a qui tam (whistleblower) provision, which allows citizens to sue on behalf of the government when a party is committing fraud against the government. The suit against RehabCare was originally filed under this section of the FCA by two whistleblowers, Janet Halpin and Shawn Fahey.

The qui tam provision of FCA provides incentives for whistleblowers, which include 15 to 30 percent of the funds recovered. For example, in this case against RehabCare, the whistleblowers will receive nearly $24 million for their part in the case. The whistleblower incentives continue to help the government (1) detect more fraud, (2) ensure money intended for health care is properly spent on health care, and (3) deter other companies from committing the same fraud.

Are you aware of fraud being committed against the federal government, or a state government? If so, the FCA can protect and reward you for doing the right thing by reporting the fraud. If you have any questions about whether you qualify as a whistleblower, please contact an attorney at Beasley Allen for a free and confidential evaluation of your claim.

There is a contact form on this website, or you may email one of the lawyers on our whistleblower litigation team: Andrew Brashier, Archie Grubb, Larry Golston, or Lance Gould.

Source: U.S. Department of Justice

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