In the Courts: Whistleblower Case Leads to $17M Antikickback Settlement

July 17, 2015 | Aging Services Risk, Quality, & Safety Guidance

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An organization that provided skilled nursing services at seven rehabilitation and skilled nursing facilities (SNFs), its operating subsidiaries and affiliates, and its president and executive director have agreed to pay $17 million to resolve allegations that the organization violated the antikickback statute of the federal False Claims Act by paying physicians for referrals of Medicare patients requiring skilled nursing care, according to a June 16, 2015, news release from the U.S. Department of Justice (DOJ).

Over several years, the company allegedly operated a "sophisticated kickback scheme" in which it hired many physicians, ostensibly as medical directors, and paid each thousands of dollars per month. Although the physicians had contracts that specified job duties and hourly requirements, the federal government alleged that these were "ghost positions" and that the physicians were required to perform few or none of the job duties. Instead, they were paid for referrals of Medicare patients to the facilities; in...

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