A major provider of home hospice and health care services has settled whistleblower claims for $150 million, according to the U.S. Attorney’s Office in the Eastern District of Pennsylvania.
The company, Amedisys, settled seven separate suits filed under the qui tam provisions of the False Claims Act with the agreement. Just over $26 million of the total will be split between the relators, who will collect between $500,000 and $19 million each. The rest goes to the government.
The allegations, which stem primarily from Amedisys’ method for fraudulently charging Medicare for medically unnecessary procedures, cover the company’s facilities in mostly Southern states. Two Pennsylvania facilities, in King of Prussia and Allentown, were also named, according to the settlement that was announced Wednesday.
“Combating Medicare fraud and overbilling is a priority for my office, other components of the Department of Justice, and United States Attorneys’ Offices across the country,” U.S. Attorney Zane D. Memeger said in a prepared statement.
“We have recovered billions of dollars in federal health care funds from schemes such as the one alleged in this case. Those are health care dollars that should be spent on legitimate medical needs. This settlement should send a message to all health care providers in the Eastern District of Pennsylvania, including home health providers, that we will continue to dedicate our full attention and resources to pursuing similar violations of the False Claims Act,” Memeger said in the statement.
Most of the actions were filed in the Northern District of Georgia, one was filed in the Western District of New York, one was filed in the Northern District of Alabama, and one was filed in the Eastern District of Pennsylvania.
The case filed in Philadelphia “had allegations that were national in scope,” said Gregory B. David, an assistant U.S. attorney in the Eastern District who worked on the case. The office had the resources to pursue it “aggressively,” he said, so they “put together a national team” and worked with other U.S. attorneys’ offices. Also working on the case in the Eastern District U.S. Attorney’s Office was Eric D. Gill.
The six other cases filed in different districts were transferred to Philadelphia after “we took the lead on the investigation,” David said.
The primary allegations were based on Amedisys’ billing, and failure to refund overpayments, to Medicare for services that it provided to patients who weren’t homebound, patients who didn’t require skilled nursing or therapy, and patients who didn’t require the given services, according to the settlement agreement. Amedisys would also allegedly overbill Medicare by “upcoding patients’ diagnoses,” according to the agreement.
That scheme allegedly took place for three years—from the beginning of 2008 to the end of 2010.
From 2008 to 2012, it was also alleged that Amedisys violated the Anti-Kickback Statute “for home health services referred by Georgia Cancer Specialists I P.C. while Amedisys was providing Georgia Cancer Specialists I P.C. remuneration that was not consistent with fair market value in the form of patient care coordination services performed by Amedisys employees,” according to the settlement agreement.
The company admitted no liability under the settlement.
“Amedisys maintains that it operated according to stringent policies requiring that home health nursing and therapy services be delivered to qualifying patients having a medical need for such care, and only upon the direction of their physicians,” it said in a statement released Wednesday.
“We are pleased to put this matter behind us,” said Ronald A. LaBorde, president and interim chief executive officer of the Baton Rouge, La.-based company.
Amedisys, which will pay the total sum in two installments, will fund the settlement through cash on hand and draw on its existing credit facility, according to the release.
The first installment, $115 million, is due within seven days of the settlement agreement’s signing date and the second installment, $35 million, is due within six months, according to the agreement.