SNF Pays $145 Million in Medicare Rehabilitation Fraud Case Life Care Centers of America Inc.—which owns and operates more than 220 skilled nursing facilities across the country—and its owner will pay $145 million to resolve allegations of false claims to Medicare and TRICARE for unnecessary rehabilitation therapy services. The settlement against Life Care and owner Forrest L. Preston resolves ... News in Brief
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News in Brief  |   January 01, 2017
SNF Pays $145 Million in Medicare Rehabilitation Fraud Case
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Special Populations / Older Adults & Aging / Healthcare Settings / Practice Management / News in Brief
News in Brief   |   January 01, 2017
SNF Pays $145 Million in Medicare Rehabilitation Fraud Case
The ASHA Leader, January 2017, Vol. 22, 12. doi:10.1044/leader.NIB4.22012017.12
The ASHA Leader, January 2017, Vol. 22, 12. doi:10.1044/leader.NIB4.22012017.12
Life Care Centers of America Inc.—which owns and operates more than 220 skilled nursing facilities across the country—and its owner will pay $145 million to resolve allegations of false claims to Medicare and TRICARE for unnecessary rehabilitation therapy services.
The settlement against Life Care and owner Forrest L. Preston resolves a federal lawsuit filed under the False Claims Act. It is the largest settlement with a skilled nursing facility (SNF) chain in the history of the Department of Justice.
The suit alleged that over seven years, the Cleveland, Tennessee-based company instituted corporate-wide policies and practices designed to place as many beneficiaries in the Medicare-designated “ultra high” reimbursement level without regard to patients’ clinical needs, resulting in unreasonable and unnecessary therapy for many beneficiaries.
According to the settlement, Life Care also sought to keep patients longer than necessary to continue billing for rehabilitation therapy, even after the treating clinicians recommended discharge. Life Care carefully tracked the minutes of therapy provided to each patient and number of days in therapy to ensure that as many patients as possible were at the highest level of reimbursement for the longest possible period.
The settlement also requires Life Care to enter into a five-year, chain-wide Corporate Integrity Agreement with the Department of Health and Human Services that includes an annual independent review of the medical necessity and appropriateness of therapy services billed to Medicare.
The settlement resolves allegations originally brought in lawsuits filed under whistleblower provisions of the False Claims Act by two former Life Care employees. Under the act, private parties can sue on behalf of the government for false claims for government funds and receive a share of any recovery (in this case, $29 million), and the government may—as in the Life Care case—intervene and file its own complaint.
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January 2017
Volume 22, Issue 1