An Illinois district court jury in United States v. Momence Meadows Nursing Center, Inc. recently issued a verdict on February 11, 2013 imposing $28.1 million in civil penalties on the operators of a nursing home. The nursing home and its prior owner were held liable under the False Claims Act and the Illinois Whistleblower Reward and Protection Act for fraudulent billing of worthless services and false certification that the nursing home was in compliance with federal and state patient care regulations.

Past employees of Momence Meadows Nursing Center brought this whistleblower action alleging that the nursing home defrauded Medicare and Medicaid by providing substandard care that left residents neglected and abused. The plaintiffs provided evidence of noncompliance with normal nursing home procedures, which caused, for example, resident burns, failure to contain a scabies outbreak, and failure to follow proper procedures regarding the prevention and care of pressure ulcers. In addition, the plaintiffs alleged that the nursing home retaliated against them after complaining about inadequate care and manipulated records to show residents received appropriate care.

The jury imposed the $28.1 million verdict by reaching two main determinations:

• The defendants made 1,729 false or fraudulent claims. With an $11,000 civil penalty per occurrence, this amounted to more than $19 million.


• The government lost over $3 million due to the nursing home providing worthless services, which resulted in an additional $9.1 million in penalties.
   

The plaintiffs were also awarded over $400,000 collectively for their retaliation claim.

What Providers Should Know

• This is one of the first False Claims Act cases in Illinois that centers on quality of care in a nursing home.


• The plaintiffs brought this case, in part, under a state law not traditionally used—the Illinois Whistleblower Reward and Protection Act.


• The jury verdict highlights the tremendous liability that may arise from allegations of substandard care, particularly in the area of skin care.


• There is a potential that more plaintiffs' attorneys will look toward this type of action, given its newfound success.

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