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False Claims Act Settlements Lead to Big Paydays for U.S. DOJ and State AGs

  • California AG Xavier Becerra reached a settlement with skilled nursing facility San Bernardino Convalescent Operations, Inc. d/b/a Legacy Post-Acute Rehabilitation Center and its owner and operator Legacy Standard, Inc. (collectively, “Legacy”) to resolve allegations that it wrongfully billed Medi-Cal for patients receiving subacute care by failing to provide the minimum number of nursing hours required for subacute care. Under the terms of the settlement agreement, Legacy will pay $1 million to the state.
  • Separately, The U.S. Department of Justice (“DOJ”) and a number of states settled with psychiatric and behavioral care services providers Universal Health Services, Inc. and UHS of Delaware, Inc. (collectively, “UHS”) to resolve allegations that UHS knowingly submitted false claims for payment by Medicare, Medicaid, and other healthcare benefits programs for services patients were ineligible for, in violation of the False Claims Act.
  • Under the terms of the DOJ-led settlement, which will resolve 18 qui tam cases, UHS will pay $117 million, of which approximately $88 million will go to the federal government and $29 million will go to participating states. UHS also agreed to retain an independent monitor to assess its patient care protections, among other things.
  • In addition to participating in the DOJ-led UHS settlement, Massachusetts AG Maura Healey reached an additional settlement with Universal Health Services, Inc. and its affiliates UHS of Delaware, Inc, and HRI Clinics, Inc. d/b/a Arbour Counseling Services (collectively, “UHS”) to resolve allegations that UHS improperly billed the state Medicaid program for services provided by unlicensed, unsupervised, and unqualified staff, among other things. Under the terms of the settlement, UHS will pay $10 million to the state and institute a multiyear compliance program in its Massachusetts clinics.