Diversicare Health Services disclosed in February that it agreed to pay $9.5 million to resolve false claims allegations.
The Brentwood, TN-based skilled nursing and rehabilitation chain was accused of knowingly submitting false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary or skilled, the Department of Justice said in a Feb. 28 release.
The settlement also resolves allegations that Diversicare, which has 74 facilities, submitted forged pre-admission evaluations of patient need for skilled nursing services to TennCare, Tennessee’s Medicaid program.
“[Nursing homes] must be held to account when they provide patients with unnecessary services that may adversely impact their well-being and waste taxpayer dollars,” Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division said.
Diversicare noted that the investigation was based on activities that occurred prior to 2012, which was before the current leadership team was in place.
“The Company continues to deny any wrongdoing in connection with the matters under investigation,” Diversicare said in a statement. It entered into the settlement “to avoid the uncertainty and expense of litigation and in order to focus on other initiatives.”
From 2010 through 2015, the government alleged, Diversicare’s corporate policies and practices were designed to place as many beneficiaries in the highest level of Medicare reimbursement — Ultra High — irrespective of the individual clinical needs of the patients. “These profit-driven policies and practices resulted in the provision of unreasonable, unnecessary, and unskilled therapy to many beneficiaries in Diversicare’s skilled nursing facilities,” the Department of Justice said.
