May 21, 2018

Tennessee Nursing Home Managers Agree to Pay $2.7 Million to Settle False Claims Act Allegations

Editor’s note: Here’s an interesting blog post from our archives that we thought was worth sharing again. The False Claims Act has enabled whistleblowers to expose fraudulent healthcare fiscal violations, while getting financial rewards for their efforts. We feel this is justice being served indeed.

Grace Healthcare LLC and its affiliate Grace Ancillary Service LLC (collectively referred to as Grace) located in Chattanooga, Tennessee agreed to pay $2.7 million to resolve allegations that the companies violated the False Claims Act by knowingly submitting or causing to be submitted false claims for medically unreasonable and unnecessary rehabilitation therapy to the Federal Medicare program and the state TennCare/Medicaid program.  The therapy services included physical, occupational, and speech therapy.

The settlement resolves the qui tam action brought under The False Claims Act by a former Grace employee that alleged that in ten nursing homes between 2007 through June 2011 Grace pressured therapists to increase the amount of therapy they provided to residents regardless of the medical necessity of such services in order to meet targets for Medicare revenue.  These targets were established without regard to the patients’ actual need for therapy and could only be achieved by billing for a large amount of therapy for each patient. Grace Ancillary Service LLC provided the therapy in some of the skilled nursing facilities owned and/or managed by Grace Healthcare LLC in Tennessee and elsewhere.

The whistleblower will receive $405,000 of the government’s recovery in accordance with the False Claims Act provisions.

Are you interested in filing a False Claims Act lawsuit due to insider information you have from your workplace responsibilities? Berg & Androphy can be of great assistance! Please visit our Qui Tam and False Claims Act section of our website and explore the wealth of resources we have to offer our many clients.