Consumer Fraud

Tennessee home health care company settles whistleblower allegations for $25 million

whistleblower Tennessee home health care company settles whistleblower allegations for $25 millionA Nashville, Tenn.-based home health care company and its affiliates have agreed to pay $25 million plus interest to settle whistleblower allegations that they violated the federal False Claims Act by submitting bills to Medicare and Medicaid that were wrongly coded and false in a scheme to boost profits.

According to the U.S. Justice Department, CareAll Management LLC, one of Tennessee’s largest home health care providers, routinely overstated the severity of patients’ conditions to increase its billings. The company also billed Medicare and Medicaid for medically unnecessary services, often treating patients who were not homebound, federal prosecutors said.

The alleged fraud lasted from 2006 to 2013, the Justice Department said, costing U.S. and Tennessee taxpayers millions of dollars in badly needed health care funds.

The allegations stem from a whistleblower complaint filed by Toney Gonzalez under the qui tam or whistleblower provisions of the False Claims Act, which authorize private individuals to sue on behalf of the federal government.

Whistleblowers whose cases result in a financial recovery receive up to 30 percent of the total recovery as a reward for their role in exposing fraud that may have otherwise remained concealed. Mr. Gonzalez will receive $3.9 million as his whistleblower reward.

This is CareAll’s second False Claims Act settlement in the last two years.  In 2012, the company paid $9.38 million to settle whistleblower allegations that it submitted false cost reports to Medicare in order to boost profits.

As a result, CareAll and its affiliated companies have been bound to a corporate integrity agreement with the Department of Health and Human Services in an effort to prevent them from engaging in future fraud and regulatory failures.

Fraudulent home-based services are surging across the country,” said Health and Human Services Atlanta agent Derrick Jackson.  “We will continue to protect both Medicare and taxpayers, and ensure that funds are not siphoned off by companies more concerned with the bottom line than patient care.”

Source: U.S. Department of Justice