Provider to pay $3 million in ambulance-swapping case

Federal authorities turned their might against a provider for the first time in an alleged ambulance fraud cause.
Federal authorities turned their might against a provider for the first time in an alleged ambulance fraud cause.

Federal authorities believe they have broken new ground by leveraging a $3.2 million settlement with a provider for its part in an alleged fraudulent ambulance service scheme.

It is believed to be the first time a provider, and not just an ambulance company, has been held accountable for a so-called ambulance-swapping arrangement.

Skilled nursing provider Regent Management Services agreed to the $3.2 million deal. Regent, which operates 11 skilled nursing facilities in Texas and one in Nevada, illegally gave price breaks in exchange for referrals of other lucrative Medicare and Medicaid business, officials said.

The provider decided to resolve the allegations in order to avoid the “costly burden” of a lawsuit, the company said in a prepared statement sent to McKnight's. There was no determination of liability in the case. 

As part of the settlement, Regent also has entered a corporate integrity agreement, under which it must make substantial internal compliance reforms over the next five years.

“Litigation always carries some degree of risk, and these types of healthcare cases are complicated and especially expensive to defend,” the Regent statement noted. “Accordingly, Regent settled this lawsuit because it was in the best interests of Regent, the 12 nursing facilities which Regent manages, and the communities it serves.”

The resolution was announced Nov. 30 by U.S. Attorney Ken Magidson of the Southern District of Texas and top investigatory officials with the U.S. Department of Health and Human Services.

“This settlement sends a message to the healthcare industry that both sides of a swapping arrangement can be held responsible for their improper actions,” Gregory Demske, chief counsel to the HHS' Inspector General's office, said in a statement.

Regent would have paid much higher transportation rates if not for the arrangement in question, officials said.