Hospice and Rehab Company Settlements Totaling $20 Million Dollars in Whistleblower Cases

For our weekly recap of False Claims Act (“FCA”) whistleblower settlement, we have a $19.5 million dollar settlement between management, therapy and hospice companies and the government for alleged Medicare billing fraud.  This is an interesting web of collusion between companies that should care for the elderly and most vulnerable populations in the U.S.  In so doing, the companies must safeguard Medicare since that is the taxpayers way of ensuring the care for the frail and elderly.  Instead, these companies chose the fraudulent path and billed the government programs for unnecessary services and submission of claims for reimbursement when they were not warranted.  Foundations Health Solutions was the management company, Olympia Therapy was the therapy company, and Tidia Hospice Care was the hospice company.

In addition, these companies paid kickbacks to a Home Health company for soliciting and receiving kickbacks for referring patients to Amber Home Care.  The whistleblower attorneys representing the qui tam relators argued that under the qui tam provisions of the FCA, there were claims submitted for medically unnecessary rehabilitation therapy, the therapy was provided at excessive levels to increase Medicare reimbursement, there were false hospice care benefit claims, and claims were submitted for patients who were ineligible for hospice benefits because there were invalid certifications for their medical examination.

Under the FCA, the Judge is entitled to order the defendant to pay triple the actual damages that the jury finds.  In addition, the FCA also 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.  The qui tam relators here will get approximately $3,750,000 dollars for their share of the settlement.

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.