Judge with gavel on table

A once well-regarded but now-shuttered physician practice must face trial in a False Claims Act case alleging it overbilled for skilled nursing care, a federal judge ruled this week.

Federal prosecutors last year filed suit against General Medicine and 17 related corporate entities owned by Thomas Prose, MD. In a 96-page complaint, the government argued that the companies intentionally scheduled unnecessary visits with nursing home patients and sometimes duplicated services or upcoded to boost Medicare billing.

According to an order issued Sept. 25, General Medicine had sought to have the entire case dismissed, arguing that the company has “been under Government scrutiny for more than 20 years, has sought and obtained Government approval for services, established policies on CMS regulatory guidance, has been through thousands of Government audits, and has received hundreds of approvals from ALJs over the years.”

The government allegations against the company come as many providers are looking to increase the presence of advanced clinicians in their buildings, with the role of SNFist valued for its ability to attract and serve short-stay Medicare patients. The outcome of the case could have important implications for physicians and others who routinely serve nursing home patients and how they bill for that care.

After GM faced a False Claims qui tam case related to nurse practitioner billing in 2002, officials agreed to a settlement that included a corporate integrity plan requiring regular reports to the federal government and at least one on-site observation of its SNF practices. That and other oversight interactions GM had with federal and state officials over the years should have unearthed any billing irregularities prior to the start of the current case, attorneys argued.

GM asked for summary judgment, explaining in a lengthy brief that the government knew and approved of its services and the methods it used to conduct and bill for now-disputed medication management reviews and care plan reviews.

But Judge Staci M. Yandle of the US District Court for the District of Southern Illinois denied that motion, citing disputed facts that she said demand further evaluation at trial.

“That [defendant’s] briefing reveals not only the existence of disputed material facts, but also a degree of misapprehension regarding the issues that require resolution in this lawsuit,” Yandle wrote. “The Government argues these documents do not establish that it ever affirmatively sanctioned GM’s practices with full knowledge of the particulars of its policies and the conduct of its clinicians. It further argues it is not alleging that the mere performance of CPRs and MMRs is per se illegal, but rather that the claims were false because GM sought payment for services not rendered, services that did not meet the requirements of the billing codes, or services that were not medically necessary as certified in each claim.”

Prose, reached by phone Wednesday, said he planned to “vigorously defend” the government’s allegations moving forward.  

GM is no longer in business, and a number listed on its website rang through to a different company.

GM’s model relied on physicians and nurse practitioners to provide care exclusively for patients in client skilled nursing, rehabilitation, assisted living and other long-term care facilities, all of it overseen by Prose as senior medical director. A website for General Medicine-The Post Hospitalist Company boasts a 6.6% hospital readmission rate for clients, a figure 65% below a cited national average of 19%.

That information was reported by the Medicare Administrative Contractor overseeing GM’s operating region; the MAC also found that GM saved the Medicare program some $200 million over a decade by reducing readmissions.