(The following press release from the U.S. Department of Justice was
received by e-mail. The sender verified the statement.)
NURSING HOME OPERATOR TO PAY $48 MILLION TO RESOLVE ALLEGATIONS
THAT SIX CALIFORNIA FACILITIES BILLED FOR UNNECESSARY THERAPY
WASHINGTON - The Ensign Group Inc., a skilled nursing provider
based in Mission Viejo, Calif., that operates nursing homes across the western
U.S. has agreed to pay $48 million to resolve allegations that it knowingly
submitted to Medicare false claims for medically unnecessary rehabilitation
therapy services, the Justice Department announced today. Six of Ensign's
skilled nursing facilities in California allegedly submitted the false claims:
Atlantic Memorial Healthcare Center, located in Long Beach; Panorama Gardens,
located in Panorama City; The Orchard Post-Acute Care (a.k.a. Royal Court),
located in Whittier; Sea Cliff Healthcare Center, located in Huntington Beach;
Southland, located in Norwalk; and Victoria Care Center, located in Ventura.
"Skilled nursing facilities that place their own financial interests above the
needs of their patients will be held accountable," said Assistant Attorney
General for the Justice Department's Civil Division Stuart F. Delery. "We will
continue to advocate for the appropriate use of Medicare funds and the proper
care of our senior citizens."
Between January 1, 1999, and August 31, 2011, these six Ensign skilled nursing
facilities allegedly submitted false claims to the government for physical,
occupational and speech therapy services provided to Medicare beneficiaries
that were not medically necessary. Specifically, Ensign provided therapy to
patients whose conditions and diagnoses did not warrant it, solely to increase
its reimbursement from Medicare. The government further alleged that Ensign
created a corporate culture that improperly incentivized therapists and others
to increase the amount of therapy provided to patients to meet planned targets
for Medicare revenue. These targets were set without regard to patients'
individual therapy needs and could only be achieved by billing at the highest
reimbursement levels. The government also alleged that Ensign billed for
inflated amounts of therapy it had not provided and that certain patients were
kept in these facilities for periods of time exceeding what was medically
necessary for treatment of their conditions.
"The case against The Ensign Group involves a company that
regularly bilked Medicare by submitting inflated bills that, in some cases,
sought money for services that simply were never provided to patients," said
U.S. Attorney for the Central District of California André Birotte Jr. "This
settlement - one of the largest Medicare fraud cases against a nursing home
chain in U.S. history - demonstrates our commitment to protecting taxpayers who
fund important programs that benefit millions of Americans, but don't want to
see their hard-earned money wasted on fraud or abuse."
In addition to paying the settlement amount, Ensign also agreed
that each of its skilled nursing facilities across the nation would be bound by
the terms of a Corporate Integrity Agreement with the Department of Health and
Human Services Office of Inspector General (HHS-OIG).
"Billing Medicare for costly, unnecessary skilled nursing services -- as the
government alleged here -- inflates health care costs borne by taxpayers," said
Special Agent in Charge for the Los Angeles Region of the HHS-OIG Glenn R.
Ferry. "This settlement again puts on notice those who would consider
defrauding federally funded health care programs."
This civil settlement illustrates the government's emphasis on combating health
care fraud and marks another achievement for the Health Care Fraud Prevention
and Enforcement Action Team (HEAT) initiative, which was announced in May 2009
by Attorney General Eric Holder and Health and Human Services Secretary
Kathleen Sebelius. The partnership between the two departments has focused
efforts to reduce and prevent Medicare and Medicaid financial fraud through
enhanced cooperation. One of the most powerful tools in this effort is the
False Claims Act. Since January 2009, the Justice Department has recovered
more than $16.7 billion through False Claims Act cases, with more than $11.9
billion of that amount recovered in cases involving fraud against federal
health care programs.
The allegations settled today arose from lawsuits filed by two former Ensign
therapists under the qui tam, or whistleblower, provisions of the False Claims
Act, which allow private citizens to bring suit on behalf of the government and
to share in any recovery. The dollar amount that the whistleblowers in this
case, Gloria Patterson and Carol Sanchez, will receive has not been determined.
The lawsuits are captioned as United States of America ex rel. Gloria
Patterson v. Ensign Group Inc., Case No. SACV 06-6956 CJC (ANx) (C.D. Calif.)
and United States of America ex rel. Carol Sanchez v. Ensign Group Inc., Case
No. SACV 06-0643 CJC (ANx) (C.D. Calif.).
The case was handled by the U.S. Attorney's Office for the Central District of
California, with assistance from the Commercial Litigation Branch, Civil
Division, U.S. Department of Justice and the U.S. Department of Health and
Human Services Office of Inspector General. This action was supported by the
Elder Justice and Nursing Home Initiative, which coordinates the department's
activities combating elder abuse, neglect and financial exploitation,
especially as they impact beneficiaries of Medicare, Medicaid and other federal
health care programs.
The claims settled by this agreement are allegations only; there has been no
determination of liability.
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