Nursing home to pay $3.5 million to settle illegal patient transfer allegations

A California nursing home and two physicians who worked at the facility will pay more than $3.5 million to resolve allegations that they took part in an illegal patient transfer scheme, authorities announced on Friday.

The settlement, reached in early August, resolves a whistleblower lawsuit brought by a former employee of Westlake Convalescent Hospital in Los Angeles. The employee's suit claims the facility paid kickbacks to a “care consortium” the city's Skid Row district to transfer patients to a hospital for unnecessary medical services between 2008 and 2010.

The patients were then transferred from the hospital to Westlake for unnecessary skilled nursing stays. The facility also allegedly billed Medicare and Medi-Cal for these services.

Jasvant Modi, M.D., a physician at the facility, allegedly admitted patients from the nursing facility to the now-shuttered hospital and back again to extend their Medicare-covered stays. His wife and fellow physician, Meera Modi, M.D., also reportedly signed medical orders for non-payable services provided to patients admitted through the scheme.

McKnight's call to Westlake for comment was not returned by press time.

The case is linked to a larger scheme to defraud federal and state health programs by illegally recruiting mostly homeless Skid Row residents for medically unnecessary hospital and nursing home stays, authorities said. Another physician pleaded guilty to his involvement in the scheme in 2013.

Ricardo Gonzales, the whistleblower who brought the case, received $534,471 from the settlement.