A Pennsylvania nonprofit nursing home in the process of being sold has agreed to settle a whistleblower lawsuit alleging it overbilled the government $819,000 for physical therapy services.
Saunders House, located in the Philadelphia suburb of Wynnewood, was first targeted with False Claims allegations in 2015.
Gerard Carson, a contracted physical therapy assistant at the facility and four others in the Philadelphia-area sued Saunders claiming the facility billed federal healthcare programs for “medically unnecessary rehabilitation therapy to residents to maximize revenue and without prioritizing clinical needs,” according to a statement by the Philadelphia U.S. Attorney’s office.
The suit’s resolution was announced Friday by the U.S. Attorney in Philadelphia.
U.S. Attorney Jacqueline Romero thanked Saunders House for cooperating with the government’s investigation. “That cooperation was taken into account when determining an appropriate resolution of these allegations,” Romero said in a statement.
Meanwhile, Saunders House’s attorney, Paula G. Sanders, of Post & Schell PC, said in a prepared statement that her client was not admitting any liability in the matter, and decided to settle the case at the time “because its continued operation was in jeopardy without a sale being completed.”
“We believe that our actions were appropriate in all cases, as we relied upon our contracted therapy company to provide medically necessary therapy services to our residents,” Sanders said, noting that at the time of the whistleblower complaint, Saunders House’s services were being provided by a third-party therapy services contractor.
The investigation, however, included allegations that Saunders House submitted therapy claims for patients in the now-defunct Ultra High RUG therapy category, despite evidence that the level of therapy “was not reasonable or necessary for the respective patients.”
“Focusing on profits over the needs of individual patients violates the public trust and creates a potential for harm of some of the most vulnerable among us,” Romero said. “It also shifts taxpayers’ funds away from the vital services of law-abiding therapy providers.”
As of Sept. 30, 2021, the department had obtained more than $5.6 billion in settlements and judgments from civil cases involving fraud and False Claims against the government.
Long-term care therapy services came under heavy scrutiny for years for alleged overbilling practices before the adoption of the Patient Driven Payment Model in 2019. PDPM implementation has been associated with a decrease in the volume of rehabilitation therapy use with no significant impact on patient outcomes, according to a January 2022 study published in JAMA Health Forum.
