Carter Healthcare LLC, an Oklahoma-based for-profit home health provider, its affiliates CHC Holdings and Carter-Florida (collectively Carter Healthcare), and their President Stanley Carter and Chief Operations Officer Bradley Carter have agreed to pay $7.175 million to resolve allegations that they violated the False Claims Act by billing the Medicare program for medically unnecessary therapy provided to patients in Florida.
Bradley Carter will pay $175,000, Stanley Carter will pay $75,000, and Carter Healthcare will pay the remaining $6.925 million of the settlement.
Between 2014 and 2016, Carter Healthcare allegedly billed the Medicare Program knowingly and improperly for home healthcare to patients in Florida based on therapy provided without regard to medical necessity and overbilled for therapy by upcoding patients’ diagnoses.
“Payment under Medicare for home health care is permitted only for those who provide medically necessary services to eligible beneficiaries,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division. “As this settlement demonstrates, the Department is committed to ensuring that providers bill only for appropriate procedures and amounts.”
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“Medicare fraud costs our taxpayers billions annually,” said U.S. Attorney Juan Antonio Gonzalez Attorney for the Southern District of Florida. “These overpayments drain the Medicare trust fund and unfairly raise the premiums our senior citizens must pay. We take this fraudulent activity very seriously and will continue to prosecute it to the fullest extent of the law.”
“This settlement is a stark reminder to home health providers that our agents are working tirelessly with the Department of Justice to pursue providers that inappropriately bill federal health care programs to boost profits, as alleged here,” said Special Agent in Charge Omar Pérez Aybar of the Department of Health and Human Services Office of Inspector General (HHS OIG), Miami Regional Office. “Our agency will not hesitate to investigate such allegations to protect federal health care programs and the patients served by these programs.”
Both Stanley Carter and Bradley Carter agreed to be excluded from participation in all Federal health care programs for a period of five years pursuant to 42 U.S.C. § 1320a-7(b)(7), the statutory authority to exclude from federal health programs individuals or entities who engaged in fraud or kickbacks.
Carter Healthcare also agreed to be bound by the terms of a corporate integrity agreement with the Department of Health and Human Services – Office of Inspector General that requires the company to implement compliance measures designed to avoid or promptly detect conduct similar to that which gave rise to the settlement.
The settlement includes the resolution of an action brought by Sharon Mahaffey and Mark Brimer, therapists formerly employed by Carter Healthcare, under the qui tam or whistleblower provisions of the False Claims Act. These provisions permit a private party to file an action on behalf of the United States for false claims and receive a portion of any recovery.
The case is captioned U.S. ex rel. Mahaffey and Brimer v. Carter Healthcare, Stanley Carter and Brad Carter, CV 16-80459 MARRA (S.D. Fla.). Mahaffey and Brimer will together receive $1.3 million as their share of the settlement.
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Along with this settlement announced today, Carter Healthcare has agreed to pay an additional $22,948,004.54 to resolve another qui tam action captioned U.S. ex rel. Duffield et al. v. CHC Holdings, LLC et al., Case No. 17-CV-826-HE (W.D. Okla.), brought in the Western District of Oklahoma, which alleged that Carter Healthcare improperly paid remuneration to its home health medical directors in Oklahoma and Texas for the purpose of inducing referrals of Medicare and TRICARE home health patients between 2013 and 2020.
The government’s resolution of this matter illustrates the government’s emphasis on combating health care fraud.
One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, can be reported to the Department of Health and Human Services (HHS), at 800-HHS-TIPS (800-447-8477).
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