Six Home Health Providers Agree to Pay $1.8 Million to Settle False Claims Act Liability

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On September 5, 2017, the Department of Justice (DOJ) announced that six Tennessee-based home health entities agreed to pay the United States $1.8 million to settle potential violations of the Stark Law and/or Anti-Kickback Statute and noncompliance with Medicare coverage and payment requirements that spanned more than ten years (“Settlement Agreement”). The Settlement Agreement indicates the providers, had they not settled the disclosed matters, faced $42 million in liabilities.

The Settlement Agreement resolves potential violations that include (i) the provision of non-monetary compensation in the form of marketing expenditures to physician practices and/or their staff that did not meet the Stark Law non-monetary compensation exception, (ii) payments to a restaurant owned by immediate family members of a referring physician for catering services without a written contract, (iii) provision of free equipment and staff services to referring physician practices, and (iv) compensation for medical director services that did not meet a Stark Law exception because the arrangements were not adequately documented. The government also alleged that certain claims for home health services did not meet Medicare billing requirements because the claims lacked the required physician certifications of eligibility required for each home health or hospice beneficiary upon the start of care and periodically throughout the beneficiary’s period of care.

The DOJ press release indicates the settlement amount, a small fraction of the potential liabilities, was largely based on the providers’ decision to voluntarily self-disclose the matters to the DOJ and cooperate with the DOJ throughout the providers’ internal investigation, as additional information was uncovered and disclosed to the government.

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