HCR ManorCare said Tuesday it will “vigorously defend” itself in three separate “whistleblower” lawsuits that allege it submitted false claims to Medicare and Tricare (formerly CHAMPUS), a Department of Defense healthcare program.
The Justice Department raised the stakes Tuesday when it announced it was intervening in and consolidating the three suits. It alleges the huge Toledo, OH-based long-term care provider “knowingly and routinely submitted” false claims for rehabilitation therapy services that were not medically reasonable and necessary.
According to the government’s complaint, the company allegedly exerted pressure on nursing home administrators and rehabilitation therapists “to meet unrealistic financial goals,” including setting prospective billing goals “designed to significantly increase revenues without regard to patients’ actual clinical needs.” The complaints also allege that the company threatened to terminate skilled nursing facility managers and therapists if they did not administer the additional treatments necessary to qualify for the highest Medicare payments. Further, the complaint alleges the provider giant increased its Medicare payments by keeping patients in its facilities even though they were medically ready to be discharged.
In a statement provided to McKnight’s, HCR ManorCare called the action “unjust” in light of the company’s prior “full cooperation” with the government’s investigation.
“At its core, this is a billing dispute between our company and the federal government,” the company statement said. “The government alleges that some of the rehabilitation services we provided were medically unnecessary, even though they were approved by the government’s own third-party review panels.” HCR ManorCare added that “in no instance” has it been accused of billing or receiving reimbursement for services it did not provide.
The company claims that the government’s allegations, which did not include any patient interviews, are based on “an after-the-fact review of fewer than 200 patient charts, some dating back nine years, which is a tiny fraction of the more than one million patients cared for in our skilled nursing facilities during that time.”
Defendants proven guilty of False Claims Act violations are liable for three times the government’s losses, plus civil penalties, the Justice Department said. Since January 2009, the department has recovered more than $24 billion through False Claims Act cases, more than $15.3 billion of which was recovered in cases involving fraud against federal healthcare programs.
HCR ManorCare is one of the nation’s largest healthcare providers, operating approximately 281 skilled nursing facilities in 30 states.