Utah Whistleblower Hotline

Health care lawsuits whistleblowers receive $3.6 for reporting false Medicare claims

The whistleblowers in this health care settlement will receive $3.6 million as a reward for reporting the false Medicare claims.Three Ohio-based health care companies and their executives will pay $19.5 million to resolve two whistleblower health care lawsuits. The lawsuits alleged that, beginning in 2008, the companies falsified Medicare claims for unnecessary services that allegedly harmed patients. The whistleblowers in this settlement will receive $3.6 million as a reward for reporting the false Medicare claims.

The DOJ announced the settlement with Foundations Health Solutions (FHS), Olympia Therapy Inc. (Olympia), and Tridia Hospice Care Inc., along with two of their executives, Brian Colleran and Daniel Parker. From 2008 to 2013, Parker and Colleran either partially controlled or owned one or more of the companies involved in the health care lawsuit.  The settlement ends two whistleblower lawsuits filed against the companies in 2011 and 2012.

FHS, Olympia, and Tridia are inter-related companies which, together, comprise one of the largest nursing home operations in Ohio. FHS was created following the merger of Provider Services Inc., which provided management services to skilled nursing facilities, and BCFL Holdings Inc. Olympia provided rehabilitation therapy services to patients at facilities managed by FHS, while Tridia Hospice Care provided hospice care services to the facilities.

The whistleblower health care lawsuits

FHS, Olympia, and Tridia were each sued in 2011 and 2012 by former employees under the federal False Claims Act (the “FCA”), which allows individuals to sue for fraud or wrongdoing on behalf of the government. The FCA also provides for those same individuals to receive up to a third of the monies recovered if the lawsuit is successful.

The first lawsuit, filed by Vladimir Trakhter, a former Olympia employee, accused Olympia and Provider Service Inc. — which is now FHS — of submitting false claims to Medicare.

According to this health care lawsuit, from Jan. 2008 to Dec. 2012, Olympia and FHS made claims for medically unnecessary rehabilitation therapy services at 18 skilled nursing facilities.The suit claims that the companies routinely assigned residents to perform costly therapy services, regardless of whether that level of professional was required in order to perform the therapy. The suit alleged that these assignments were medically unnecessary and were done solely to obtain higher levels of Medicare reimbursements. The suit also alleged that some patients were subjected to unnecessarily stringent therapies which, in some cases harmed the patients when they were unable to tolerate the therapy.

In one case the lawsuit cited as an example, one patient with a weak heart and a mood disorder became exhausted and stressed out from a treatment he was receiving from two therapists. After arguing unsuccessfully with the therapists about his reluctance to continue the therapy, the patient suffered a heart attack from which, the suit claimed, he could not be resuscitated.

Bourne Goodwin FHS, filed by former Tridia employees Paula Bourne and La’Tasha Goodwin in Dec. 2012, accused the hospice care provider of submitting false claims to Medicare from April 2011 to Dec. 2013.

According to the lawsuit, Tridia submitted false claims to Medicare for hospice services provided to patients who were ineligible for the Medicare hospice benefit because Tridia failed to conduct proper certifications or medical examinations.

Settling the health care lawsuits

Under the terms of the settlement, the companies will reimburse Medicare, and pay $2.9 million to Trakhter, the former Olympia employee, and $740,000 to Paula Bourne and La’Tasha Goodwin, the former Tridia employees.

The terms of the settlement also include a requirement for FHS and Colleran take steps to avoid or promptly detect future fraud and abuse by entering into a five-year Corporate Integrity Agreement, designed to increase accountability and transparency in the companies’ practices.

Whistleblowers who know their rights before coming forward and have an experienced whistleblower attorney by their side when they do come forward have the best chance of success in their lawsuit. If you are thinking of reporting fraud or false claims, protect yourself first: contact us by email or call the hotline at (801) 323-5000 for a free and confidential evaluation of your claim.