$3.8 million settlement shows nursing homes must oversee their therapy providers, feds say

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Two long-term care companies have agreed to a $3.75 million settlement over charges that they failed to sufficiently control an outside therapy provider's billing and care practices, the Department of Justice announced Friday.

Therapy provider RehabCare Group East Inc. allegedly engaged in a variety of practices to maximize reimbursements, including putting patients into the highest level of therapy without evaluating their actual clinical needs. Iowa-based Life Care Services LLC, a nursing home management company, and CoreCare V LLP, doing business as a California skilled nursing facility named ParkVista, did not prevent these practices, the government charged.

“Settlements like this one show that, when a facility contracts with an outside rehabilitation therapy provider, the facility has a continuing responsibility to ensure that the provider is not engaged in conduct that causes the submission of false claims to Medicare,” stated U.S. Attorney Carmen M. Ortiz for the District of Massachusetts.

Life Care Services and CoreCare have not admitted any wrongdoing. The agreement was reached to “avoid the cost and uncertainty of protracted litigation,” according to a statement released by Life Care Services. LCS maintains high standards for compliance and oversight, President Ed Kenny emphasized in the prepared statement.