In a landmark
settlement, Life Care Centers of America, one of the nation’s largest private skilled
nursing care companies, has agreed to pay $145 million to resolve charges that
it overbilled the government for rehabilitation therapy services. Life Care, based in Cleveland, Tenn., owns and operates
more than 200 skilled nursing care centers in 28 states.
Department of Justice says the resolution is the largest settlement with a
skilled nursing center chain in its history.
The government lawsuit alleges that
Life Care violated the False Claims Act by knowingly causing skilled nursing
facilities to submit false claims to Medicare and TRICARE for rehabilitation
therapy services that were not “reasonable, necessary, or skilled.”
alleges that during the period from Jan. 1, 2006, to Feb. 1, 2013, Life Care instituted corporate-wide policies and
practices designed to place as many beneficiaries in the Ultra High therapy
reimbursement level irrespective of the clinical needs of the patients. Life
Care has strongly disagreed with the allegations and believes that it was
entitled to payment for services rendered.
complaint also alleges that Life Care sought to keep patients longer than was
necessary in order to continue billing for rehabilitation therapy.
federal health care programs for medically unnecessary rehabilitation services
not only undermines the viability of those programs, it exploits our most
vulnerable citizens,” says U.S. Attorney Nancy Stallard Harr for the Eastern
District of Tennessee. “We are committed to working with our federal partners
to protect both.”
“We deny in the
strongest possible terms that Life Care engaged in any illegal or improper
conduct,” says Life Care owner Forest Preston. “We are, however, pleased to
finally put this matter behind us, without any admission of wrongdoing, and we
look forward to continuing our efforts to deliver quality care and services to
our patients, residents, and their families.”
As part of
the settlement, Life Care has entered into a five-year chain-wide Corporate Integrity
Agreement with the Department of Health and Human Services Office of Inspector
General that requires an independent review organization to annually assess the
medical necessity and appropriateness of therapy services billed to Medicare.