Genesis Healthcare Settles False Claims Act Lawsuits for $53.6 Million For Alleged Medically-Unnecessary Services

As we routinely report these settlements on a weekly basis, our False Claims Act (“FCA”) focused employment attorneys continue to represent whistleblowers in California.  Our attorneys submit many examples of these types of settlements to both California FCA violations and federal FCA violations of Medicare, Medi-Cal, Medicaid, TriCare, CHIP, and many other government programs.

In today’s example, one of the largest operator of long term care facilities that specialize in rehabilitation and nursing services, Genesis Healthcare was alleged to have violated the FCA by filing false claims for services to government health care programs.  These services were allegedly not medically necessary so the therapy, nursing, and hospice services filed for government reimbursement were “grossly substandard” and often times not performed at all.

Some of the facilities, such as Skilled Healthcare Group and Sun Healthcare Group, involved in this settlement were not owned by Genesis at the time that the fraud took place.  Regardless, they were alleged to have submitted false claims to Medicare by billing for hospice services for patients who were not ill and in the last stages of their lives as required by Medicare hospice laws.  Another example was the submitting of false claims for Medicare, Medicaid and Tricare for therapy services that were for longer periods than were medically necessary, grossly substandard services, or billing for more therapy minutes than the patients actually received.  Finally, another type of fraud committed was where they submitted false claims to Medicare Part B for outpatient therapy services that were not medically necessary or even unskilled.

Under the FCA, the Judge may order the defendant to pay triple the actual damages.  Also, the FCA permits statutory penalties from $5,500 to $11,000 for each false claim submitted by the defendant.  As result, the whistleblower will receive approximately 15 to 25 percent of the total FCA recovery plus attorney’s fees.

As the main enforcement arm of the federal government, the Justice Department reviews all cases filed under the FCA.   Then, once the whistleblower case is assessed, the government decides whether it will prosecute or allow the whistleblower to bring the complaint on the government’s behalf.

The FCA is used to stem out fraud related to billing, staffing, and kickbacks. Examples of these are when financial companies are supposed to abide by state and federal laws and chose to ignore them.  They also bills for services that were not provided or the bill was submitted at an improperly higher rate of reimbursement for the services.  In addition, financial companies are often fount to illegally bill the government for substandard services by fraudulently certifying otherwise. Alternatively, these companies may realize that they have credit from their services that they have to repay to the government, but the companies do not reimburse the government within the 60 day time frame.  See these blogs for more examples of the FCA.

If you witness any potential false claims in California (i.e. requests for reimbursement to the government, not actually rendering work when reimbursement is received, or receiving and knowingly retaining an overpayment) by your company, or you are retaliated against for voicing your concern about potential wrongdoing, immediate action is vital.  Contact the experienced employment law attorneys at Stephen Danz & Associates for a free consultation to discuss your circumstances and legal options.