A California-based skilled nursing operator, along with 27 of its affiliated facilities, accused of therapy upcoding is settling federal fraud allegations for $16.7 million.
The Department of Justice announced the False Claims Act settlement with Longwood Management Corporation and its facilities on Monday. Three whistleblowers will receive about $3 million after filing the two original lawsuits.
A message left by McKnight’s Long-Term Care News to Longwood for comment was not returned by production deadline.
Federal authorities claimed that Longwood knowingly submitted false and fraudulent claims for “unreasonable and unnecessary” Ultra High levels of rehabilitation therapy to Medicare Part A residents.
The operator is alleged to have pressured therapists to increase the amount of therapy provided to meet pre-planned targets for Medicare revenue. The company allegedly set the targets without regard to patients’ individual therapy needs, and the targets could only be achieved by billing for a high percentage of patients at the Ultra High level, according to the DOJ.
The alleged scheme happened at 21 facilities between Jan. 2006 and Oct. 2014, and at six other facilities between May 2008 and Aug. 2012.
“When skilled nursing facilities provide rehabilitation therapy services based on maximizing revenue rather than the interests of their patients, we will hold them accountable,” Ethan Davis, acting assistant attorney general for the Department of Justice’s Civil Division, said in a statement.