Georgia-Based Nursing Home to Pay $11.2 Million in Landmark Whistleblower Case

In what is becoming more of a trend, another healthcare institution has agreed to settle a claim of defrauding the national Medicare program.

Georgia-Based Nursing Home to Pay $11.2 Million in Landmark Whistleblower Case

Late last month, the Department of Justice (DOJ) confirmed in a press release that it had reached a settlement agreement with SavaSeniorCare LLC - a nursing home operator based out of Atlanta, Georgia.

As explained, SavaSeniorCare LLC is a nursing home operator. The company runs several senior nursing homes, many of which have branches in the state and other surrounding states. According to the DOJ press release, the organization and several of its affiliates had been billing Medicare for several unnecessary therapy services.

Fraud to Promote the Bottom Line

The claim against SavaSeniorCare primarily stems from violating the False Claims Act (FCA) - one of the oldest - and the most powerful - of the whistleblower protection laws in the country. Under the FCA, whistleblowers will be eligible to report cases of fraudulent acts by organizations or companies in the country - especially those which result in loss of money on the part of the federal government.

If the investigation and prosecution lead to a conviction, the whistleblower is eligible for 15 to 30 percent of the proceeds collected. Since the criminal is usually liable for civil penalties and damages under the FCA, rewards can be substantial.

In the case of SavaSeniorCare, the company was accused of knowingly submitting false claims for rehabilitation services between October 2008 and September 2012. This was done in an effort to improve the company’s earnings and boost its bottom line. SavaSeniorSare specifically put much pressure on its senior nursing facility (SNF) to meet financial goals which, by any standard, were unrealistic.

In order to meet these financial goals, the nursing facilities began billing unreasonable and unnecessary services to their patients.

Apart from the unrealistic financial targets, Sava also allegedly submitted false claims to Medicaid for co-insurance amounts for medical rehabilitation services for both Medicare and Medicaid. In addition, the company submitted false payment claims to both Medicaid and Medicare, despite knowing that it was providing substandard and worthless nursing services.

The claims against SavaSeniorCare were brought by several whistleblowers - Rita Hayward, Trammel Kukoyi, Terrence Scott, James Thornton, and Barbara Roberts. Under the False Claims Act, the whistleblowers would be eligible for financial compensation since SavaSeniorSare made payments to the government. However, it is unclear how much they would have gotten out of the settlement amount.

The DOJ eventually started investigating the company in 2015. Speaking to news sources, Annaliese Impink, a spokesperson for SavaSeniorCare Administrative and Consulting LLC., explained that the company had spent several years and millions of dollars defending itself from the allegations. Now, settling with the government and regulators seemed like the perfect thing to do.

Dissolving the Issue Once and For All

Under the terms of the agreement, SavaSeniorCare will pay $11.2 million to settle the case. The fees will cover both federal and state charges, although SavSeniorCare could end up paying more if several financial contingencies are met.

In addition to the agreement, Sava has agreed to enter into a Corporate Integrity Agreement (CIA) with the Office of the Inspector-General at the Department of Health and Human Services. The agreement requires that an independent review organization will audit patient stays being operated by Sava, and other related pay claims made by Medicare for those stays. It will run for five years, and it will cover every institution that Sava operates.

Sava has also agreed to have an independent monitor who will review the quality of resident care being discharged at locations run by Sava. In her statement, Impink explained that the CIA is a positive step for Sava. For one, it ensures that the company’s care will remain of top-notch quality. She added:

“We believe that this process will assist us with further enhancing our clinical and quality systems and will provide additional educational support for our center teams. We also hope to take advantage of best practices the monitor can share from other providers they have worked with. As is always the case, we will continue to focus our efforts on supporting our staff who work tirelessly to improve the quality of care and quality of life for those individuals we are privileged to serve.”

Speaking on the case, Mary Jane Stewart, the Acting U.S. Attorney for the Middle District of Tennessee, explained that this is a terrible occurrence of corporate greed rising to uncontrollable levels. The U.S. attorney added that it is important to hold the companies accountable and stem the rising tide of fraud that could undermine the level of care provided to elderly nursing home residents.

Stewart also thanked the whistleblowers who tipped the authorities off and ensured that Sava didn’t go unpunished for what they had done.

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