A U.S. Bankruptcy Court in Delaware has approved a settlement between Florida-based nursing home chain Consulate Health Care and the Department of Justice that reduced a $258 million judgment against the operator to just $4.5 million.
Consulate confirmed the finalized agreement after a final hearing was held on Wednesday. The company declined comment after an initial report of the settlement was detailed earlier in the month, opting to wait until the agreement was finalized. A spokeswoman also confirmed previously reported details of the settlement remained in place.
“In what has been a decade-long battle to litigate claims brought against two care centers prior to their affiliation with our company, we are beyond relieved and grateful that a fair settlement has finally been reached,” Consulate said in a statement to McKnight’s Long-Term Care News.
“We appreciate everyone’s collaboration and diligence throughout this process, which has ultimately resulted in the ideal outcome for all parties, a sentiment echoed in today’s hearing at which no objections were filed,” the company added.
The settlement comes after six of its affiliated nursing homes filed for Chapter 11 bankruptcy in response to a Florida federal appeals court reinstating $257.7 million of an original $347.9 million verdict in a False Claims Act case against the entities.
In the original case, whistleblower Angela Ruckh, a one-time employee at two centers owned by La Vie Rehab in Florida, filed suit against the company, accusing it in 2011 of overcharging Medicare and Medicaid by inflating therapy claims.
La Vie Rehab’s ownership was transferred to Consulate Health Care in 2012 and the latter inherited the case.
Under the settlement, the United States will instead receive $3.375 million and Ruckh would get $1.125 million.
“This is a giant step forward, and although there is still much to do in the days and weeks ahead, we look forward to moving beyond what has been an exhaustive and complex process and dedicating all of our energy towards serving our communities and those entrusted to our care,” Consulate officials said.