Signature Healthcare to pay more that $30 million to resolve False Claims Act allegations

Staff Reports • Jun 11, 2018 at 9:14 PM

NASHVILLE – Signature Healthcare agreed to resolve allegations it violated the False Claims Act by knowingly submitting false claims to Medicare for rehabilitation therapy services that were non reasonable, necessary and skilled.

The organization is a Louisville, Kentucky-based company that owns and operates about 115 skilled nursing facilities, including seven in Middle Tennessee.

The settlement also resolved allegations Signature submitted forged pre-admission certifications of patient need for skilled nursing to Tennessee’s Medicaid program. Under the settlement agreements, Signature agreed to pay more than $30 million, and the state of Tennessee will receive a portion of it.

“Health care providers who engage in deceptive practices place patients at unnecessary risk and contribute to the financial distress of our federal healthcare programs,” said U.S. attorney Don Cochran. “Our dedicated teams of civil enforcement attorneys will work tirelessly with the relators who report fraud such as this and with our law enforcement partners who investigate healthcare fraud. When we determine that companies are cheating the taxpayers, we will hold them accountable as we have in this case.”

The government alleged Signature engaged in various practices that resulted in the submission of claims for unreasonable, unnecessary and unskilled services to Medicare patients, including:

• presumptively placing patients in the highest therapy reimbursement level, rather than relying on individualized evaluations to determine the level of care most suitable for each patient’s clinical needs.

• providing the minimum number of minutes required to bill at a given reimbursement level while discouraging the provision of additional therapy beyond that minimum threshold.

• pressuring therapists and patients to complete the planned minutes of therapy even when patients were sick or declined to participate in therapy.

“Health care fraud impacts the quality of our health care, in addition to costing consumers and taxpayers,” said acting Tennessee Bureau of Investigation director Jason Locke. “We are fortunate to have this strong relationship with our federal law enforcement partners in continuing to investigate this type of behavior in Tennessee.”

The settlement resolves allegations filed in a lawsuit by Kristi Emerson and LeeAnn Tuesca, former Signature therapy employees, in federal court in Nashville. The lawsuit was filed under the whistleblower provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows the government to intervene and take over the action, as it did in this case. Emerson and Tuesca will receive a portion of the recovered funds.

“We will continue to work with our state and federal partners to hold healthcare providers accountable for false billing,” said state Attorney General Herbert Slatery III. “This settlement demonstrates a continued commitment to protecting the integrity of the TennCare program.”

“Signatute was charged with illegally boosting profits by providing excessive amounts of therapy to patients whether they needed it or not,” said special agent in charge Derrick L. Jackson with the U.S. Department of Health and Human Services office of inspector general. “The decision to provide therapy should never be based on corporate financial considerations rather than a patient’s medical needs.”

The settlements were the result of a coordinated effort by the Civil Division of the Department of Justice, the U.S. attorney’s offices for the Middle District of Tennessee and the Northern District of Georgia; the Tennessee Bureau of Investigation; the Defense Criminal Investigative Service; and the Department of Health and Human Services office of the inspector general.

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