False Claims Act Violations Caused Government to Overpay Nursing Facilities Over $5 Billion

HHS OIG

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In a shocking new report recently released by the Department of Health and Human Services Office of Inspector General (HHS-OIG), it was revealed that Medicare overpaid approximately $5.1 billion for patient stays in skilled nursing facilities.

The study conducted by HHS-OIG based their findings on a random sample of skilled nursing facility stays in the year 2009. During each of these stays, the facilities failed to meet quality of care standards set forth by the federal government. During the year 2012, the total payments for Medicare reimbursements in skilled nursing facilities were $32.2 billion. If the same level of spending had prevailed in 2009, 15.84 percent of all Medicare payments to skilled nursing facilities were for services that did not meet the program’s requirements.

Federal law requires that skilled nursing facilities develop a care plan for each individual patient and administer care following that plan of action. In addition, skilled nursing facilities are required to create plans for each patient’s discharge. According to the 2009 data, for 37 percent of patient stays, either skilled nursing facilities did not create care plans that satisfied federal requirements or they failed to provide services that were specifically developed under care plans. For 31 percent of patient stays, skilled nursing facilities did not meet discharge planning requirements. HHS-OIG also identified examples of poor quality of care in the areas of wound care, medication management and physical therapy.

Medicare Costs

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Skilled nursing facilities who accept Medicare patients must comply with numerous federal statutes and follow strict rules developed by the Center for Medicare and Medicaid Services (CMS), the Department of Health and Human Services (HHS) and various other agencies. When the government reimburses a skilled nursing facility for healthcare services they are not entitled to based on the fact that the skilled nursing facility is  not -compliant with federal or state laws or regulations, the skilled nursing facilities’ claims to the government for reimbursement could constitute fraudulent claims and the skilled nursing facilities could be in violation of the federal False Claims Act or state False Claims Acts. Moreover, if an individual has knowledge and evidence of such false claims the individual should consult a False Claims Act (or whistleblower) attorney to report the Medicare and Medicaid fraud.

Momence Meadows

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A recent False Claims Act lawsuit in Illinois shows the increasing number of healthcare deficiencies in skilled nursing facilities. A jury returned with a verdict in the federal district court of Illinois against Momence Meadows Nursing Center for failing to provide adequate care to Medicare patients. Two former nurses of the facility brought the claims under the whistleblower (qui tam) provisions of the False Claims Act. Both former nurses alleged that the treatment the patients received was so poor that Medicare was entitled to recover the money paid for the services. After a short deliberation, the jury found that the United States had paid, through Medicare, $3 million for services which did not meet the federal quality standards. Since the statute provides for treble damages and civil penalties of as much as $11,000 per violation, the jury’s total verdict amounted to $29 million. Of the total amount recovered by the government, both whistleblowers (the former nurses) will be entitled to share an award valued at 15 to 30 percent, which could be as much as $8.7 million.

Illinois Lawsuit

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 The False Claims Act is a federal whistleblower statute dating back to 1863, passed during the Civil War to protect against fraud and abuse by government contractors. Individuals and contractors face liability under the Act for submitting false claims for payment to the government, or failing to return an overpayment form the government. Under the False Claims Act, any agent, contractor, or employee who takes lawful efforts to stop a violation of the Act may file suit under the statute’s anti-retaliation provisions even if no suit was initially filed.

Under the qui tam provisions of the False Claims Act, individual whistleblowers (known as relators) are able to sue on behalf of the government for false claims. Under the statute, whistleblowers must file their claims under seal and then disclose the allegations to the United States. Upon disclosure, the government investigates the claims and determines whether to intervene in the case. Even if the government does not intervene, whistleblowers may proceed with their False Claims Act lawsuit privately. Whistleblowers represented by seasoned legal counsel with experience handling qui tam litigation, such as Berger Montague, have had great success in cases where the government has previously declined to intervene.

 

By | 2018-03-26T01:20:04+00:00 March 19th, 2013|Healthcare Fraud|