A contract rehabilitation therapy company has agreed to pay $8.4 million dollars to resolve allegations that they violated the False Claims Act by knowingly causing 12 skilled nursing facilities in New York and New Jersey to submit false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary, or skilled.
At various times between January 1, 2016, through March 31, 2016, the rehabilitation therapy company contracted with 12 skilled nursing facilities in New York and New Jersey to provide rehabilitation therapy services. The United States alleges that the contract therapy company’s policies and practices encouraged and resulted in the provision of medically unnecessary, unreasonable, and unskilled therapy services being provided to residents at the 12 skilled nursing facilities.
The Acting U.S. Attorney for the District of New Jersey stated, “ Skilled nursing facility residents and their families must be assured that the care and therapy that residents receive is based on medical need, not greed. We must also protect the taxpayers by ensuring that Medicare pays only for appropriate services performed for legitimate medical purposes. We will hold all health care providers who violate the False Claims Act responsible for their actions.”
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by a former therapy company employee. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery.
The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of New Jersey, with assistance from HHS-OIG.
The investigation and resolution of this matter illustrate the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
Issue:
It is extremely important that all members of the healthcare team are aware of what may be considered a false claim or a kickback. Ensure that all staff are aware that these violations can occur whether they are intentional or unintentional. Failure to promptly report a false claim or kickback can result in lawsuits, fines, and other sanctions. Additional information is available in the Med-Net Corporate Compliance and Ethics Manual, Chapter 1 Compliance and Ethics Program, CP 2.3 General Legal Duties and Antitrust Laws.
Discussion Points:
- Review policies and procedures for preventing and reporting a false claim or anti-kickback statute violation. Update your policies and procedures as needed.
- Train all staff on the False Claims Act and Anti-Kickback Statute and what can be considered a false claim or kickback. Include information on how to report concerns and suspected violations, and that prompt reporting is mandatory. Document that the trainings occurred and place in each employee’s education file.
- Periodically audit staff to ensure that they are aware of what should be done if they suspect a false claim or illegal kickback has occurred, whether intentionally or unintentionally. Conduct audits of documentation and billing routinely to prevent and detect errors before they progress to a false claim.
