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Nursing Home Chain Faces Lawsuit For Overbilling

Nursing Home Chain Faces Lawsuit For Overbilling

The U.S. Justice Department recently announced that they will be stepping into a long-running lawsuit against one of the nation’s largest nursing-home chains, HCR ManorCare, which operates some 280 skilled nursing facilities across 30 states. ManorCare has been accused of intentional widespread Medicare over-billing for procedures and treatment that was both unnecessary and in some cases harmful to the patients in their care.

While the investigation has been on-going since the initial accusations against the company were filed by a northern Virginia occupational therapist in 2009, the Federal government just recently decided to take control of the whistleblower lawsuit filed in U.S. District Court in Alexandria, VA. The lawsuit was initially filed under the False Claims Act, which allows private citizens to bring lawsuits on behalf of the United States when they have knowledge that the government is being defrauded. After the claim is filed by a private citizen, the government can then investigate and decide whether it wants to take over the case. In cases where the government interventions the original filing party is entitled to collect anywhere from to 15 to 25 percent of any money recovered through the government’s pursuit of the case.

The lawsuit alleges that ManorCare routinely pressured administrators of its nursing homes, assisted living and rehab facilities to meet financial targets by billing for unnecessary care, which sometimes put frail, dying patients through grueling rehab schedules. According to the lawsuit, in 2006 ManorCare billed Medicare at the top reimbursement rate for 39 percent of its patients, yet by 2009 the top reimbursement rates had doubled to 80 percent. The increase was one of many red-flags investigations into the company’s billing practices have already uncovered. According to reports, investigators believe that Medicare paid more than $6 billion to ManorCare between January 2006 to May 2012; how much of that was unfounded has yet to be determined.

In recent years, nursing homes and other assisted living facilities have seen an increase in lawsuits. At DigniCare, we understand that senior living care is more than a business; the senior living industry consists of facilities, communities, and caregivers whose mission is to provide many different types of services and care and to provide individuals with a quality, dignified life. Please contact us today at (855) 883-6306 for more information about our policies and risk management programs.

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