A dispute over therapy billing practices by Diversicare Healthcare Services has been resolved after the company announced on Wednesday its settlement agreement with the Department of Justice has been finalized.
The deal with the DOJ was first announced by the company last August. Diversicare will pay a total of $9.5 million over a five-year period, starting with an initial payment of $500,000, the long-term care provider said Wednesday.
The allegations originated in July 2012, before the current leadership team was put in place.
“[Diversicare] continues to deny any wrongdoing in connection with the matters under investigation, but entered the settlement in order to avoid the uncertainty and expense of litigation and in order to focus on other initiatives,” the provider stated in a release.
The DOJ also announced a settlement over False Claims Act allegations with Guardian Elder Care Holdings, a Pennsylvania-based skilled nursing home chain, that will cost the provider nearly $15.5 million.
The allegations stemmed from a whistleblower complaint that accused the provider of pressuring rehabilitation therapists to provide services to meet financial goals and maximize revenues, instead of clinical needs.
“For example, they [whistleblowers] alleged that certain patients suffered from dementia and did not need or want rehabilitation therapy, but Guardian Elder Care allegedly pressured therapists to provide those services anyway to meet revenue goals,” the U.S. Attorney’s Office for the Eastern District of Pennsylvania said Wednesday.
The nursing home operator and its related companies will more than $15,466,000 to settle the allegations. The whistleblowers will share about $2.8 million of the recovered funds.
