On October 21, 2016, a $145 million settlement was announced between the U.S. Department of Justice and Life Care Centers of America for billing Medicare for false claims.
Two former employees of Life Care filed a lawsuit under the whistleblower provisions of the False Claims Act. The Act allows individuals to sue a provider on behalf of the government for making false claims for federal funds. The Department of Justice (DOJ) can then file its own claim, which it did in this case. The False Claims Act also allows for a reward for whistleblowers. In this case, the DOJ did file a claim, and the whistleblowers will be rewarded. In this case the whistleblower reward was $29 million.
The $145 million settlement is the largest settlement amount with a skilled nursing chain is the largest in the DOJs history. Benjamin Mizer, head of the DOJs civil division, said “It is critically important that we protect the integrity of government health care programs by ensuring that services are provided based on clinical rather than financial considerations.” [Read more…]