[Post updated 2021 – After a decade of litigation, whistleblowers prevail… keep reading for new information]
The U.S. Department of Justice intervened in a Medicare fraud case initially filed by three former employees-turned-whistleblowers. The government seeks to recover millions of dollars allegedly paid to SavaSeniorCare, a large nursing home operator. According to the complaint, Sava operates approximately 200 facilities scattered in 23 states.
The complaints were filed over several years. Because Medicare fraud cases filed under the False Claims Act are filed under seal, the three co-workers were probably unaware of each other complaints. The three whistleblowers include a former director of social services in Tennessee, a former rehabilitation manager in Pleasanton, Texas and a social worker who once worked at Sava’s Houston facility.
Under the False Claims Act, a whistleblower is entitled to receive up to 30% of whatever the government collects from the wrongdoer.
Although each complaint has different facts, the three all allege a Medicare fraud scheme in which managers were given unrealistic financial goals. Prosecutors say the only way to meet those goals was to provide “medically unreasonable, unnecessary and unskilled services” that could be falsely billed to the Medicare program. In a prepared statement, a DOJ spokesperson said, “The provision of Medicare benefits must be dictated by patient need, not by Medicare providers’ efforts to maximize profits by pressuring their employees to provide medically unnecessary services.”
In addition to medically unnecessary services, the complaints say that Sava would delay discharging patients even if their condition warranted release. The goal was to prolong Medicare billings.
At times Sava owned facilities would waive Medicare copayments in an attempt to keep patients from leaving. (Waiving copayments is a violation of the federal Anti Kickback Statute and can be the basis of a False Claims Act claim.)
According to one of the complaints, an employee told the facility administrator, “’You know, Nicki [Ms. McCaleb], I don’t look good in orange,’ referring to the color of prison uniforms. All of the attendees at these meetings knew that McCaleb was asking them to falsify medical records, and Medicare/ Medicaid records, claims, and submissions.”
Although the complaints were filed some time ago, they were just unsealed after the government decided it would intervene. Sava has not yet been required to file an answer to the complaints.
Medicare fraud complaints filed by whistleblowers remain under seal (secret) while being investigated by the government. The statute gives the government just 60 days to investigate but judges routinely extend that time period for months and sometimes years.
In addition to the alleged Medicare fraud, the whistleblowers claim that employees who did not go along with the scheme were harassed or threatened with termination. The False Claims Act contains strong anti-retaliation provisions to protect whistleblowers that step forward.
May 2021 Update:
SavaSenior Care to Pay $11 Million to Settle Medicare Fraud Charges
Sometimes justice can seem like it takes forever. The brave whistleblowers who filed this claim began 10 years ago. After a full decade, we are happy to report that justice prevailed.
On May 21st, Acting Philadelphia United States Attorney Jennifer Arbittier Williams announced that SavaSeniorCare LLC and related entities (Sava) will pay $11.2 million to settle claims they violated the False Claims Act by causing their skilled nursing facilities “to bill Medicare for rehabilitation therapy services that were not reasonable, necessary or skilled, and to resolve allegations that Sava billed Medicare and Medicaid for grossly substandard skilled nursing services.”
In announcing the settlement, Williams said,
“Nursing home residents should not be at the mercy of nursing home operators that put their own economic gain ahead of the needs of the residents, and we will continue to aggressively pursue those operators who bill Medicare and Medicaid for substandard care. This settlement holds Sava accountable, and the resulting Corporate Integrity Agreement should ensure that Sava provides seniors with quality care and treats its residents with dignity and respect.”
We don’t yet know how much money the whistleblowers will be paid. The typical reward is 20% which translates to $2,240,000.00.
Ultimately the government consolidated four whistleblower lawsuits filed both in Philadelphia and Tennessee. Typically only the first whistleblower to file gets paid the reward. There can be exceptions if different whistleblowers bring significantly different information about the wrongdoing. This emphasizes the importance of being the first to file. If you procrastinate, other may beat you to the courthouse.
How to Report Medicare Fraud (and Collect a Reward)
Healthcare fraud is everywhere. The FBI estimates that ten cents of every dollar we spend on healthcare and health insurance is lost to fraud. Not only does healthcare fraud hurt every American, it frequently results in physical harm to patients. Think about it, would you want your aging loved ones subjected to painful and unnecessary physical rehabilitation therapy?
To learn more, visit our Medicare fraud information page. If you have knowledge of Medicare or Medicaid fraud, give us a call. Our whistleblower clients have received over $100 million in awards.
MahanyLaw – America’s Medicare Fraud Lawyers