SNFs Pay $3.75 Million to Settle Contractor Fraud Allegations Skilled nursing facilities share responsibility if their rehabilitation contractors submit fraudulent Medicare claims for therapy services, according to a $3.75 million settlement between the U.S. Department of Justice and two SNF operators. Life Care Services LLC, a Des Moines, Iowa-based SNF manager, and CoreCare V LLP, doing business as ParkVista, ... News in Brief
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News in Brief  |   November 01, 2014
SNFs Pay $3.75 Million to Settle Contractor Fraud Allegations
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Healthcare Settings / Practice Management / Regulatory, Legislative & Advocacy / News in Brief
News in Brief   |   November 01, 2014
SNFs Pay $3.75 Million to Settle Contractor Fraud Allegations
The ASHA Leader, November 2014, Vol. 19, 12. doi:10.1044/leader.NIB3.19112014.12
The ASHA Leader, November 2014, Vol. 19, 12. doi:10.1044/leader.NIB3.19112014.12
Skilled nursing facilities share responsibility if their rehabilitation contractors submit fraudulent Medicare claims for therapy services, according to a $3.75 million settlement between the U.S. Department of Justice and two SNF operators.
Life Care Services LLC, a Des Moines, Iowa-based SNF manager, and CoreCare V LLP, doing business as ParkVista, a skilled nursing facility in Fullerton, California, have agreed to pay $3.75 million to the government for failing to prevent RehabCare Group East Inc., a subsidiary of Kindred Healthcare Inc., from submitting therapy claims for unreasonable or unnecessary rehabilitation services.
The settlement resolves allegations that LCS and ParkVista failed to prevent RehabCare from providing unreasonable or unnecessary therapy to patients to increase Medicare reimbursement to the facilities. The government contended that the reported therapy did not reflect the lower amounts of therapy generally provided to patients over the course of their stay.
The claims resolved by the settlements are allegations; there has been no determination of liability.
The settlement also resolves allegations that LCS and ParkVista failed to prevent other RehabCare practices designed to inflate Medicare reimbursement, including:
  • Automatically assigning patients to the highest level of therapy services without evaluating each patient’s needs.

  • Providing the minimum number of therapy minutes required to bill at the highest reimbursement level and discouraging amounts beyond that minimum threshold, despite Medicare requirements that the care provided be determined by patients’ clinical needs;.

  • Arbitrarily shifting the number of minutes of therapy between therapy disciplines to ensure targeted reimbursement levels were achieved.

  • Reporting estimated or rounded minutes instead of reporting the actual minutes of therapy provided.

“Settlements like this one show that, when a facility contracts with an outside rehabilitation therapy provider, the facility has a continuing responsibility to ensure that the provider is not engaged in conduct that causes the submission of false claims to Medicare,” stated U.S. Attorney Carmen M. Ortiz for the District of Massachusetts.
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November 2014
Volume 19, Issue 11