A nursing home chain with more than two dozen facilities in Tennessee has settled a $230 million Medicare fraud case.
The government’s investigation launched in 2014 when two whistleblowers started collecting evidence on their own.
LeeAnn Holt and Kristi Emerson, both of whom are occupational therapists from Columbia, collected reams of anecdotes — in part, because they were concerned they might get in trouble themselves. That evidence is the basis of settlement announced late Friday between the federal government and Louisville-based Signature Healthcare, which operates more than 100 facilities in 17 states.
Holt recalls a patient with advanced cancer who just wanted to spend time with her family rather than continue with therapy.
“She just put her hand on the therapist and said, ‘Honey, you need to go work with somebody that can really benefit from this.’ And you know, when you have a patient that is telling you that, you really have to stop and take inventory of what is going on here.”
The complaint against Signature Healthcare (download here) accuses the company of systematically administering occupational, physical and speech therapy when it wasn’t warranted and withholding care when government reimbursements were already maxed out. According to the suit, the unnecessary therapy pushed patients into a category where the facility was reimbursed more per day for those patients, often hitting precisely the 720-minute per week threshold for maximum payment.
As part of the $30 million settlement with the U.S. Department of Justice, the company has admitted no liability and denied the allegations. But in a statement, CEO Joe Steier says the payout “allows us to move forward in serving our residents.”
Emerson says she hopes the case will still inspire other health care workers to push back when they feel pressured to do procedures they deem medically unnecessary.
“We can’t just blame these corporations for all of this,” she says. “We have to shoulder as therapists some of the responsibility because we’ve allowed this to get this bad.”
Emerson and Holt were let go amid the investigation and have found it difficult to find stable work. “No one really wants a whistleblower in their building,” Emerson says.
But now they will split roughly $6 million as their share of the settlement. Whistleblowers are entitled to 15 percent to 25 percent of the total.
The lead lawyer is Jerry Martin, the former U.S. Attorney for Middle Tennessee. As a prosecutor, Martin made prosecuting health care chains a priority, given the concentration in Nashville, and says he’s doing the same in private practice.
“We feel like we’re just getting started,” Martin says. “All these businesses — these health care companies — are dependent upon the government, the taxpayer money. That’s their business model.
“And so in exchange for that, you ought to be willing to accept a fair amount of oversight.”
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