Amedisys settles False Claims Act allegations with federal government for $150 million; six of seven suits were pending in Eastern District of Pa.

Louisiana-based home health services company Amedisys Inc. has agreed

to pay the federal government $150 million to settle allegations that it and its affiliates violated the False Claims Act by submitting false home healthcare billings to Medicare, federal prosecutors announced on Wednesday.

U.S. Attorney Zane David Memeger, of the Eastern District of Pennsylvania, announced the accord between the U.S. government and Amedisys, which is one of the country’s largest providers of home health services, operating in 37 states, the District of Columbia and Puerto Rico.

The settlement resolves allegations that between 2008 and 2010, certain Amedisys offices improperly billed Medicare for ineligible patients and services.

Specifically, Amedisys allegedly billed the federal healthcare program for nursing and therapy services that were medically unnecessary or provided to patients who were not homebound, and otherwise misrepresented patients’ conditions to increase Medicare payments, according to the U.S. Attorney’s Office in Philadelphia.

The billing violations were allegedly the result of management pressure on nurses and therapists to provide care based on the financial benefits to Amedisys, rather than the actual needs of patients.

“Combating Medicare fraud and overbilling is a priority for my office, other components of the Department of Justice, and the United States Attorneys’ Offices across the country,” Memeger said in a statement. “We have recovered billions of dollars in federal health care funds from schemes such as the one alleged in this case. Those are health care dollars that should be spent on legitimate medical needs.

“This settlement should send a message to all healthcare providers in the Eastern District of Pennsylvania, including home health providers, that we will continue to dedicate our full attention and resources to pursuing similar violations of the False Claims Act.”

The settlement also resolves claims that Amedisys maintained improper financial relationships with referring physicians, including the allegation that the company’s financial relationship with a private oncology practice in Georgia violated statutory requirements.

In the Georgia case, Amedisys employees allegedly provided patient care coordination services to the practice at below-market prices.

The Anti-Kickback Statute and the Stark Statute restrict the financial relationships that home healthcare providers may have with doctors who refer patients to them, according to the U.S. Attorney’s Office.

The $150 million settlement resolves seven lawsuits pending against Amedisys in federal court, six of which were playing out in the Eastern District of Pennsylvania.

The suits had been filed under the qui tam, or whistleblower provisions of the False Claims Act, which enables private citizens to bring claims on behalf of the federal government and share in any recovery.

“Improper financial relationships and false billing, as alleged in this case, can shortchange taxpayers and patients,” Daniel R. Levinson, inspector general for the U.S. Department of Health and Human Services, said in a statement. “Our compliance agreement with Amedisys contains strong monitoring and reporting provisions to help ensure that people in federal health programs will be protected.”

As part of the settlement agreement, Amedisys also agreed to be bound by the terms of a corporate integrity agreement with HHS, which requires the companies to implement compliance measures designed to avoid or promptly detect conduct similar to that which is outlined in the settlement.

“It is critical that scarce Medicare home health dollars flow only to those who provide qualified services,” Stuart F. Delery, assistant attorney general for the Justice Department’s Civil Division, said in a statement. “This settlement demonstrates the Department’s commitment to ensuring that home health providers, like other providers, comply with the rules and don’t misuse taxpayer dollars.”