Nursing Facility Pays $38M in Largest Settlement in History
- On October 10, the Justice Department and the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) jointly announced the largest failure of care settlement with a chain-wide skilled nursing facility in the department’s history. The settlement involves Extendicare Health Services Inc. and its subsidiary Progressive Step Corporation (ProStep) agreeing to pay $38 million to the United States and eight states. This is to resolve allegations that Extendicare billed Medicare and Medicaid for medically unreasonable and unnecessary rehabilitation therapy among other questionable practices.
Extendicare is a Delaware corporation that, through subsidiaries, operates 146 skilled nursing facilities in 11 states. ProStep handles physical, speech and occupational rehabilitation services.
The allegations in question stem from an investigation that focused between the years of 2007 and 2013. It was discovered that in 33 of its skilled nursing homes in eight states, Extendicare billed Medicare and Medicaid for materially substandard skilled nursing services and failed to provide care for residents that met federal and state standards of care and regulatory requirements.
This includes allegations that Extendicare failed to provide a sufficient number of skilled nurses to adequately care for its skilled nursing residents; failed to provide adequate catheter care to some residents; and failed to follow the appropriate protocols to prevent pressure ulcers or falls.
The settlement also includes allegations of unreasonable and unnecessary rehabilitation therapy services to its Medicare Part A beneficiaries during the patients assessment reference periods. This was done to bill Medicare for those patients at the highest per diem rate possible.
“Our seniors rely on the Medicare and Medicaid programs to provide them with quality care, ensuring that they are treated with dignity and respect when they are most vulnerable,” Acting Associate Attorney General Stuart Delery said in the release. “It is critically important that we confront nursing home operators who put their own economic gain ahead of the needs of their residents. Operators who bill Medicare and Medicaid while failing to provide essential services or bill for services so grossly substandard as to be effectively worthless will be pursued for false claims.”
Acting Assistant Attorney General Joyce Branda for the Civil Division added that the continued viability of Medicare depends on integrity and honesty of the of the program participants. Corporate financial targets need to be taken out of the decision making process of health providers. Instead they should be focusing solely on their patients’ clinical needs.
According to the settlement, the federal government will receive $32.3 million and the eight state Medicaid programs will receive $5.7 million. This is because the Medicaid program is funded jointly by the federal and state governments. Furthermore, Extendicare and ProStep are required to enter into a five year chain-wide Corporate Integrity Agreement with the HHS-OIG which features a comprehensive compliance program.
