When Edward Lacey, a 16-year veteran Home Health Executive with Visiting Nurse Service of New York, detected what he believed to be false claims to Medicare for home health services, he refused to remain quiet about it. Instead, he and his attorneys filed a False Claims Act lawsuit alleging that his company shirked its obligations related to the Plans of Care (POC) for its patients.
Specifically, Mr. Lacey alleged that in relentless pursuit of profit, Defendant Visiting Nurse Service of New York (VNSNY) accepted all referrals for home health care, even when it knew it did not have staff to adequately provide care for so many patients. As a result, VNSNY engaged in a systematic failure to provide its patients the home care visits and services specifically ordered by their referring physician in the patient Plans of Care, according to the lawsuit. Further, it was alleged that a significant number of VNSNY nurses and therapists falsified their patient time and service records because they were forced to meet impossibly high daily visit counts and often patient visits were too short to perform any kind of meaningful care. Despite knowledge that its clinicians were falsifying visit notes, VNSNY billed Medicare and Medicaid for visits and services it knows it did not provide, according to the Complaint. Mr. Lacey provided evidence of this fraud by referencing specific dates where VNSNY nurses claimed implausiblly high volumes of home health visits — sometimes up to 20 patient visits to different homes in one day — but did not provide patient signatures to verify the visit.
After a prolonged battle as the lone whistleblower in a case where the Department of Justice failed to enforce Lacey’s claims and failed to come to the aid of Americans enrolled in the home health program who were allegedly receiving sub-par care, Lacey and his attorneys proceeded on their own to recover $57 million in damages and penalties on behalf of the United States and the taxpayers.
Of course, in making the $57 million payment, the corporate defendant refused to accept responsibility and denied all of the allegations. Industry corporate trade group, the National Association for Homecare & Hospice (NAHC) also loudly echoed the assertion that the corporation’s conduct was acceptable and up to the standards of the multi-billion dollar home health industry. The NAHC is funded by over 30,000 home health and hospice corporations that feed off the over $120 billion paid to home health and hospice companies by taxpayers through the Medicare program every year.
The Federal False Claims Act authorizes whistleblowers and their attorneys to bring suit on behalf of and in the name of the United States to recover for fraudulent billings and to be awarded up to 30% of the recovery plus attorneys’ fees and costs. The statute mandates that for every dollar a corporation has defrauded the government, they should have to pay $3 plus a per claim penalty. Accordingly, the entire whistleblower award comes from the punitive aspect of the case and not from the amount that the United States lost as a result of the fraudulent conduct. All of the money wrongfully billed by a company under the False Claims Act is returned to the federal fisc.
In this case, Edward Lacey and his attorneys will receive 29% of the $57 million payment (just over $16.5 million). The law firm of Frohsin Barger & Walthall represents whistleblowers in actions against home health and hospice corporations as well as other companies that defraud federal and state programs. Our firm is responsible for the largest Home Health fraud recovery in history, $150 million against Amedisys and the largest Hospice fraud recovery in history $75 million against Vitas. We applaud the bravery, hard-work, and tenacity of Mr. Lacey and his attorneys at Constantine Canon for bolding pursuing this case on behalf of the United States.