Pediatric Services of America pays $6.88 million settling False Claims Act case

Pediatric Services of America  will pay $6.88 million to resolve allegations it failed to disclose and return overpayments received from federal health-care programs.Norcross, Ga.-based Pediatric Services of America Healthcare, Pediatric Services of America Inc., Pediatric Healthcare Inc., Pediatric Home Nursing Services (collectively PSA), and Portfolio Logic LLC provide home nursing services to medically fragile children.

The settlement is the first under the False Claims Act involving a health-care provider’s failure to investigate credit balances on its books to determine if they resulted from overpayments made by a federal health-care program.

The federal government alleged PSA failed to disclose and return overpayments to Medicare and Medicaid, submitted claims under the Georgia Pediatric Program for home nursing care without documenting the requisite monthly supervisory visits by a registered nurse and submitted claims to federal health care programs overstating the length of time its staff provided services. All of this caused PSA to be overpaid.

PSA maintained credit balances on its books related to claims it submitted to various federal health-care programs, some of which had been on its books for several years. Additionally PSA wrote off and absorbed credit balances from overpayments into its revenue because it had not investigated the reason for the credit balances before doing so, the federal government said.

As part of the settlement, PSA has agreed to enter into a corporate integrity agreement with the U.S. Department of Health & Human Services, Office of Inspector General, which will require it to put in place procedures and reviews to avoid and detect promptly conduct similar to that which gave rise to the settlement.

The settlement resolves allegations filed by whistle blowers Yvette Odumosu and Sheila McCray. Odumosu and McCray will receive a $1.1 million share of the settlement payment that resolves the qui tam suits they filed. The claims settled in the civil settlement are allegations only, and there has been no determination of liability.

Jeffrey Newman represents whistleblowers but not these whistleblowers.