A Tennessee healthcare provider has agreed to pay $9.5 million to resolve allegations from the Department of Justice (DOJ) that it violated the False Claims Act by knowingly submitting false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary, or skilled. The settlement also resolves allegations that the provider submitted forged pre-admission evaluations of patient need for skilled nursing services to TennCare, the state of Tennessee’s Medicaid Program.
From January 1, 2010 through December 31, 2015, the healthcare provider’s corporate policies and practices were designed to place as many beneficiaries in the highest level of Medicare reimbursement-Ultra High-irrespective of the individual clinical needs of the patients. These profit-driven policies and practices resulted in the provision of unreasonable, unnecessary, and unskilled therapy to many beneficiaries in the provider’s skilled nursing facilities.
The DOJ alleged that claims for Ultra High therapy levels were submitted despite evidence that (1) the frequency and duration of physical or occupational therapy was not reasonable or necessary for the patient, (2) the intensity of the physical or occupational therapy was inappropriate for the patient and not reasonable or necessary, (3) services did not require the skills of a therapist to perform them, and (4) speech therapy was medically unnecessary. This included specific instances of repetitive and unskilled exercises in order to achieve minute thresholds. Patients were engaged in activities contraindicated by underlying medical conditions, Activities of Daily Living (ADL) scores were inflated, and patient lengths of stay were extended unnecessarily.
It is alleged that the provider billed for services that were not provided, using budgets, goals, and quotas to ensure Ultra High therapy was maximized. Adverse actions and threats were allegedly made against employees if they failed to meet the budgets, goals, or quotas.
A five-year Corporate Integrity Agreement (CIA) with HHS-OIG is in place requiring the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks as part of the agreement. The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.
Compliance Perspective
Knowingly submitting claims to Medicare for reimbursement of services that were not reasonable, necessary, or were provided by inappropriately skilled individuals, along with threats and retaliation against employees for not meeting the company’s budgets, goals, or quotas, is considered a violation of the False Claims Act and other state and federal regulations.
Discussion Points
- Review policies and procedures regarding submission of Medicare claims under the patient-driven payment model (PDPM) based on a resident’s condition and the appropriate levels of care.
- Train staff on PDPM requirements and their need to report any pressure to provide residents with excessive levels of services or any threats of retaliation to their supervisor or through the Hotline.
- Periodically audit to determine if claims being submitted to Medicare are reasonable, medically necessary, and not upcoded to meet company goals, quotas, or budgets.
FOR MORE INFORMATION ON THIS TOPIC: FRAUD MODULE 16 – FINANCIAL INTEGRITY
