ResCare Iowa, Inc. to Pay Over $5 Million to Settle Healthcare Fraud Allegations

Home-based nursing care is considered somewhat of a luxury under government healthcare regulations. This means there are limited circumstances under which programs like Medicare, Medicaid, or TRICARE will reimburse a company for home-based services. Patients must meet strict eligibility criteria prior to receiving reimbursement. Under current guidelines, a medical doctor must certify that home-based nursing care is medically necessary, that the patient is completely homebound, and that traveling to a clinic or doctor’s office for assistance would be impossible or extremely difficult for the patient. If the patient does not meet these standards, he or she is expected to seek medical treatment at a covered facility, which will naturally result in a much lower reimbursement rate.

Today’s case involves ResCare Iowa, Inc., a subsidiary of Kentucky-based ResCare, Inc. The federal and state governments have recovered $5.63 million from the company following allegations of medically unnecessary home care, resulting in millions of dollars in intentionally-fraudulent invoices. The case was brought to light following a concerted investigation between the Department of Justice’s Civil Division, U.S. Attorney’s Office for the Northern District of Iowa, HHS-OIG, and the Iowa Attorney General’s Office.

Details of the case against ResCare Iowa, Inc.

ResCare Iowa, Inc. is in the business of providing necessary skilled nursing services to patients within the home setting. According to their website, their goal is to allow seniors to remain in their homes and avoid the difficult life transition associated with moving to a nursing home. Using the slogan “She just wants to be a stay-at-home grandma,” ResCare, Inc. touts its personal care, homemaking, and skilled nursing services, without much mention of the Medicare guidelines that require a finding of immobility.

According to the allegations, ResCare ran afoul of home healthcare regulations, beginning with its enrollment procedures. In order to qualify for homecare, which we mentioned requires certification of medical necessity by a doctor, that doctor must conduct a face-to-face personal assessment of the patient. Allegedly, ResCare skipped this step with a majority of its patients and falsely certified eligibility without conducting the requisite battery of tests.

Government’s response

The government continues its hard work toward eliminating wasteful healthcare fraud and maintains a steady investigative group known as the H.E.A.T. task force. According to the Attorney General’s Office:

“Home health agencies that bill Medicare and Medicaid must follow the rules….This settlement demonstrates the Department’s commitment to safeguarding taxpayer dollars and ensuring that they are used to provide medically necessary services to federal health care beneficiaries.”

The U.S. Attorney’s Office for the Northern District of Iowa also commented, stating:

“We commenced this investigation due to concerns that this provider was not complying with the rules and was not submitting accurate claims for payment….When the government pays for home-based medical services, we are dedicated to ensuring the money is well spent and medically deserving patients receive the care to which they are entitled.”

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