A large Indiana nursing home provider agreed to settle a False Claims lawsuit alleging it defrauded the Medicare program by improperly billing for already-covered services for hospice patients.

US Attorney Zachary A. Myers said American Senior Communities will pay nearly $5.6 million in damages to resolve allegations that it violated the False Claims Act by submitting false claims to the Medicare program.

ASC charged Medicare directly for various therapy services previously covered by beneficiaries’ Medicare hospice coverage, authorities said.

In a statement sent to McKnight’s Long-Term Care News Thursday, Sherrie Davies, vice president of marketing for ASC, denied liability. She added that complaints relate “to only a narrow set of services ASC provides to residents, and importantly do not suggest any impropriety with respect to quality of care or patient harm.”

The company added that it has implemented a number of measures to enhance its billing procedures to protect against conduct of the kind alleged in the suit.

“ASC is pleased to resolve this legacy matter relating to conduct that was alleged to have initiated under its prior management team,” she added.

In 2018, former ASC CEO James Burkart pleaded guilty to three federal felony offenses, including conspiracy to commit fraud, conspiracy to violate the healthcare anti-kickback statute and money laundering. He was sentenced to 9½ years in prison.

The facilities are now operated by an entirely new management and leadership team.

This week’s settlement involves claims made in 2017, when a former employee of a hospice services company doing business with ASC filed a sealed civil complaint under the False Claims Act in the US District Court for the Southern District of Indiana, the government explained in announcing the settlement.

“Whistleblowers are critical to protecting public funds from fraud, waste, and abuse,” Myers said. “Healthcare providers who submit false claims or otherwise violate state and federal regulations when billing the United States Government will face consequences.”