Orange County News

Mission Viejo nursing home operator settles in Medicare fraud case

Tuesday, November 19, 2013

An Orange County-based corporation that operates nursing homes has agreed on a $48 million settlement involving a case accusing them of inflating Medicare bills.

The settlement was unsealed late Monday by a federal judge in Los Angeles. It resolves lawsuits filed by two former employees of the Ensign Group, Inc., a Mission Viejo-based corporation.

Ensign operates six nursing facilities that allegedly submitted false claims to Medicare. The facilities allegedly submitted false claims to the government between Jan. 1, 1999 and Aug. 31, 2011 for physical, occupational and speech therapy services that were not medically necessary or not even provided. The government also alleges that certain patients were kept in the Ensign facilities for longer than necessary.

The six facilities named in the Medicare fraud lawsuit include Atlantic Memorial Healthcare Center in Long Beach, Panorama Gardens in Panorama City, Orchard Post Acute Care (commonly called Royal Court) in Whittier, Sea Cliff Healthcare Center in Huntington Beach, Southland in Norwalk, and Victoria Care Center in Ventura.

According to the lawsuit, Ensign gave therapists improper incentives to increase the amount of therapy to patients in order to meet planned targets for Medicare revenue. These targets were allegedly set without regard to patients' individual therapy needs.

In a news release issued Tuesday, United States Attorney André Birotte Jr. described the settlement as "one of the largest of its kind in United States history."

Following the settlement, Ensign entered into a corporate integrity agreement with the Health and Human Services Inspector General's Office. However, the corporation never admitted liability in the case.

(Copyright ©2014 KABC-TV/DT. All Rights Reserved.)

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