Breon Peace, United States Attorney for the Eastern District of New York, and Letitia James, New York State Attorney General, announced settlement agreements with Brooklyn-based licensed home care service agencies (LHCSAs) Edison Home Health Care of New York LLC (Edison) and Preferred Home Health Care of New York LLC (Preferred). The settlement agreements address allegations that Edison and Preferred, which were related companies, violated the federal False Claims Act and New York State’s False Claims Act in claiming that they paid their home care aides the minimum wages required under New York State law. This Office, in coordination with the New York State Attorney General’s Office’s Medicaid Fraud Control Unit, commenced an investigation after whistleblowers alleged that certain LHCSAs had knowingly defrauded the federal government and New York State by underpaying home health aides in violation of the Wage Parity Act.
The government’s investigation determined that Edison and Preferred certified their compliance with the law and sought and received reimbursement from Medicaid, even though the government determined that their payments to their aides fell short of the requisite compensation. Under the terms of the agreements with the United States and New York State, Edison and Preferred have agreed to pay $3.9 million to the United States and $5.85 million to New York State for conduct that took place from 2012 to 2022. In addition to the payments to resolve the government’s fraud claims, Edison and Preferred are required to pay $7.5 million to current and former aides who were and are entitled to compensation under the Wage Parity Act. Moreover, Edison and Preferred have admitted to conduct that led the government to determine that they fell short of Wage Parity Act requirements.
