Kusserow’s Corner: Home Health Agency to Pay $150 Million in DOJ Settlement

This blog has reported dozens of home health cases investigated and prosecuted for Medicare and Medicaid fraud. This sector continues to be the leading program vulnerable to fraud and abuse. More provider cases from this sector have been prosecuted at the federal level. At the state level, about forty percent of Medicaid fraud cases relate to home health fraud. Several of the blog’s articles related some of the major undertakings to curtail this problem. Most of the enforcement actions involved relatively small home health agencies, but now one of the nation’s largest providers of home health services has reached settlement with the Department of Justice (DOJ) to resolve fraud charges. Amedisys Inc., a Louisiana-based home health agency and its affiliates (Amedisys), have agreed to pay $150 million to the federal government to resolve allegations that they violated the False Claims Act by submitting false home healthcare billings to the Medicare program. They operate in 37 states, the District of Columbia, and Puerto Rico. The DOJ actions were the result of “whistleblowers” (qui tam relators).

The allegations were that certain Amedisys offices improperly billed Medicare for ineligible patients and services for nursing and therapy services that were medically unnecessary or provided to patients who were not homebound, and otherwise misrepresented patients’ conditions to increase its Medicare payments. The settlement also addressed allegations that Amedisys maintained improper financial relationships with referring physicians at a private oncology practice in Georgia–whereby Amedisys employees provided patient care coordination services to the oncology practice at below-market prices–violated the Anti-Kickback Statute and the Stark Laws.

Amedisys also agreed to be bound by the terms of a Corporate Integrity Agreement with the HHS Office of Inspector General (OIG) that requires the companies to implement compliance measures designed to avoid or promptly detect conduct similar to that which gave rise to the settlement.

This settlement resolves seven lawsuits pending against Amedisys in federal court–six in the Eastern District of Pennsylvania and one in the Northern District of Georgia–that were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery. The lawsuits are captioned United States ex rel. CAF Partners v. Amedisys, Inc.,10-cv-2323 (E.D. Pa.); United States ex rel. Brown v. Amedisys, Inc.,13-cv-2803 (E.D. Pa.); United States ex rel. Umberhandt v. Amedisys, Inc.,13-cv-2789 (E.D. Pa.); United States ex rel. Doe v. Amedisys, Inc., 13-cv-3187 (E.D. Pa.); United States ex rel. Ognen v. Amedisys, Inc,. 13-cv-4232 (E.D. Pa.); United States ex rel. Lewis v. Amedisys, Inc., 13-cv-3359 (E.D. Pa.); and United States ex rel. Natalie Raven v. Amedisys, Inc., 11-cv-0994 (N.D. Ga.). The claims settled by the agreement are allegations only, and there has been no determination of liability.

The pattern of how cases develop continues with this latest action. Whistleblowers continue to be the major source of cases involving home health fraud cases and in this case, former Amedisys employee whistleblowers will collectively split over $26 million. Another common feature of home health cases is the presence of kickbacks and inducements to foster the fraudulent scheme.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2014 Strategic Management Services, LLC. Published with permission.