Ambulance company reaches $8 million settlement to resolve charges over improper skilled nursing facility arrangements

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The nation's second-largest ambulance services company has reached a settlement agreement over whistleblower charges of improper business dealings with skilled nursing facilities, Rural/Metro Corporation announced Tuesday.

Under the agreement with the U.S. Attorney's Office, Rural/Metro would pay more than $8 million to the federal government to resolve a case that was brought in 2009, according to the company. The charges were filed against Pacific Ambulance Inc. and Bowers Companies Inc., which Rural/Metro acquired in 2011.

If the settlement is approved, it will release Rural/Metro from “legacy liabilities” in connection with the alleged wrongdoing, all of which occurred prior to the acquisition, the company stated.

The whistleblower suit charged that Pacific and Bowers engaged in a swapping arrangement with skilled nursing facilities, according to Tuesday's announcement. A Rural/Metro spokesman said he was not able to provide further detail about the charges to McKnight's.

Often, swapping arrangements involve companies giving price breaks to SNFs for goods and services for residents on Medicare Part A in exchange for more lucrative business involving people on Medicare Part B or other health plans.

Rural/Metro officials said they plan to pay the settlement amount from an escrow account. The payment would have “no impact” on its balance sheet, the company stated. The firm is based in Arizona and owned by private equity company Warburg Pincus LLC.