Articles Posted in Nursing home fraud

One of the nation’s largest nursing home chains agreed to pay $38 million to settle federal and state charges that it wrongly billed Medicare and Medicaid for “effectively worthless” services and failed to provide proper care for some residents.

Extendicare Health Services Inc., which through its subsidiaries operates 146 skilled nursing facilities in 11 states, will pay $32.3 million to the federal government and $5.7 million to eight state Medicaid programs to settle False Claims Act charges. Two whistleblowers will share just more than $2 million for reporting the wrongdoing.

David Marshall, a name partner at Katz, Marshall & Banks who along with Vogel, Slade & Goldstein represented whistleblower Tracy Lovvorn, said, “Whenever a health-care company administers services based on profit rather than patient needs, both the patients and the taxpayers suffer harm.” Lovvorn received $1.8 million of the whistleblower award, plus another $990,000 from Extendicare to settle her claims for unlawful retaliation and attorney fees.

The Ensign Group Inc. which operates a large number of nursing homes has agreed to pay $48 million to resolve allegation that it submitted inflated bills to Medicare for physical, occupational and speech therapy services for Medicare beneficiaries which weren’t medically necessary or never took place.

The case which was originally brought by two company whistleblowers Gloria Patterson and Carol Sanchez was joined by Uncle Sam and related to billing from the period 1999 to 2011. The allegations stated that Ensign incentivized therapists to increase the amount of therapy provided to Medicare beneficiaries that weren’t medically necessary.

The case was brought under the False Claims Act which allows individuals to bring a case on behalf of the government and to collect up to 30% of what the Government collects. The whistleblowers are expected to be rewarded about $4.8 million each for bringing forth the information concerning company fraud.

The owner of a nursing home has been sentenced to 27 months in federal prison for fraudulently billing Medicaid programs $45,039,230 over 2.5 years. Umawa Oke Imo a citizen of Nigeria and owner of City Nursing Services in Texas was found guilty of 39 counts of health care fraud.

This month the government unveiled a scheme by two companies Omnicare and IVAX, which was uncovered when whistleblowers came forward to file lawsuits.The settlements WHICH RESULTED IN OVER $112 million returned to the givernment are based on five separate whistle blower lawsuits filed by private individuals and consolidated in U.S. District Court in Massachusetts under state and federal false claims statutes. The states and the federal government alleged that Omnicare and IVAX engaged in several unlawful kickback schemes:

* Omnicare solicited and received $8 million for agreeing to purchase $50 million in generic drugs from IVAX Pharmaceuticals and to push nursing home patients to use the drugs.

* Omnicare paid $50 million to certain nursing home chains in exchange for 15-year contracts to refer nursing home patients to Omnicare for the patients’ drug purchases.