Provider's payout in whistleblower billing fraud case approaches $60 million

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Settlement this week comes on top of 2016 agreement
Settlement this week comes on top of 2016 agreement

A New York provider serving elderly and disabled Medicaid beneficiaries has reached a $10.3 million settlement in a state and federal case over long-term care payments supposedly made to residents of adult homes even when they were ineligible for coverage.

In a U.S. District Court filing dated March 27, Centerlight Health System Inc. of New York City agreed to pay that amount — on top of a 2016 agreement that requires $46.8 million to resolve related allegations brought by a whistleblower.

The Justice Department officially announced the latest agreement late Wednesday, about a year after Centerlight sold its managed long-term care plan at the center of the dispute.

In the latest settlement, the government alleged Centerlight submitted false claims for monthly payments of $3,800 to $4,200 each for 186 adult-home residents who sometimes didn't receive the kind of community-based long-term care services required for eligibility. The company also was accused of failing to remove ineligible clients from its rolls between April 2012 and September 2015.

In a prepared statement, a Centerlight spokeswoman told McKnight's on Thursday that the company is pleased to resolve the case regarding “isolated conduct that occurred many years ago.”

“We look forward to our continued collaboration with the state as we carry out our nonprofit mission as New York's only 5-star rated PACE,” or provider of all-inclusive care for the elderly.

The whistleblower in this case also brought a similar case against the Visiting Nurse Service of New York that resulted in a $35 million settlement in November 2014, according to Bloomberg Law. A $4.4 million follow-up agreement was finalized in July 2017.

The judge has yet to set David Heisler's payout in the Centerlight case.

The Justice Department alleged Centerlight contracted with licensed home-care agencies to provide services to its enrollees but did not always ensure those services were delivered.

Previously, the Justice Department alleged the provider used adult day-care centers to enroll ineligible beneficiaries in its managed long-term care plan.