October 05, 2016

Last month, in U.S. ex rel. Hayward v. SavaSeniorCare LLC, the Tennessee district court emphatically rejected the efforts made by defendant operators of a large nursing home chain to dismiss the U.S. Department of Justice’s False Claims Act complaint alleging a chainwide pattern of administering unnecessary skilled therapy to inflate Medicare reimbursement amounts. This opinion should help to inform the course of the multitude of FCA cases that involve large volumes of claims and many different patients.

In recent years, the skilled nursing facility industry has become a major focus of the federal health care programs and the DOJ’s enforcement efforts under the False Claims Act. The reasons are clear -- Medicare pays over $30 billion each year to skilled nursing facilities, which along with Medicaid covers millions of mostly elderly and infirm Americans residing in nursing homes.[1]

The full Law360 article can be read here

[1] See The Henry J. Kaiser Family Foundation, “An Overview of Medicare” (Apr. 1, 2016), available at http://kff.org/medicare/issue-brief/an-overview-of-medicare/ (skilled nursing facilities account for 5% of Medicare’s $632 billion in 2015 expenditures); Vincent Mor, et al., “The Revolving Door of Rehospitalization From Skilled Nursing Facilities,” Health Affairs (Jan. 2010), available at  https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2009.0629 (1.1 million Medicare and Medicaid patients admitted to nursing homes in 2005).