Frohsin Barger & Walthall Wins Largest Home Health Fraud Settlement in United States History Against Amedisys
When home health nurse April Brown came to Frohsin Barger & Walthall with allegations that national home health giant Amedisys was defrauding the Medicare system, she triggered an investigation by the firm that convinced Jim Barger and Elliott Walthall that Amedisys was committing fraud on both nationwide and on a massive scale. After the firm filed a qui tam suit against Amedisys, independent investigations by The Wall Street Journal and United States Senate Committee on Finance seemed to confirm Barger’s and Walthall’s suspicions. Ultimately, six more whistleblowers filed suit against Amedisys, and Barger and Walthall – acting as lead trial counsel – helped negotiate a record $150 million settlement for the U.S. and $26 million reward for the whistleblowers. Our initial client, April Brown, received $15 million as her reward for exposing Amedisys’ fraud. The Amedisys settlement, negotiated by Frohsin Barger & Walthall, remains the largest Medicare home health fraud recovery in our nation’s history.
“This settlement demonstrates the department’s commitment to ensuring that home health providers, like other providers, comply with the rules and don’t misuse taxpayer dollars.”
– Assistant Attorney General Stewert Delery, commenting on Frohsin Barger & Walthall’s record $150 million settlement with Amedisys
Frohsin Barger & Walthall Has Identified and Uncovered the Following Types of Home Health Fraud:
- Upcoding or overstating the severity of a patient’s condition; inflating patient OASIS scores by falsifying or manipulating information
- Billing for home care provided to non-homebound, non-qualifying patients
- Billing for medically unnecessary therapy visits and other treatment
- Billing for services not rendered, including visits that are never performed
- Billing for services performed by untrained, unauthorized personnel
How the Medicare Home Health Benefit Works:
As part of its Part B coverage, Medicare pays for some “home health services” for qualified patients. To qualify for home health care reimbursement under Medicare, a patient must: (1) be homebound – i.e., generally confined to his or her home, able to leave only by considerable effort; (2) need part-time skilled nursing services or speech therapy, physical therapy, or continuing occupational therapy as determined by a physician; and (3) be under a plan of care established and periodically reviewed by a physician and administered by a qualified home health agency. See 42 U.S.C. 1395(f). When a patient so qualifies, Medicare will pay for: (1) part-time skilled nursing care; (2) physical, occupational, or speech therapy; (3) medical social services (counseling); (4) part-time home health aide services; and (5) medical equipment and supplies.
However, some home health companies commit fraud by certifying and providing care to patients who do not qualify for the Medicare home health benefit. For example, if the patient is not actually homebound and frequently leaves home for routine or recreational activities, yet the home health care company certifies that the patient is eligible for the Medicare home health benefit, provides care and bills Medicare for such care, then the home health company could be committing fraud.
“[A]n analysis by The Wall Street Journal of Medicare payments to home health care companies in recent years raises questions about whether some companies — including the sector’s largest, Amedisys Inc. — are taking advantage of the Medicare reimbursement system.”
– Barbara Martinez, Wall Street Journal investigative reporter
Certifying completely ineligible patients is not the only way that home health companies have been found to commit Medicare fraud. For instance, companies committing fraud often encourage clinical staff to make the patients look sicker than they actually are on paperwork. This allows the company to receive a higher Medicare reimbursement amount than they are actually entitled. This type of “up-coding” fraud is often done by manipulating a patients’ OASIS assessment, described in detail below.
Medicare pays for home health care by way of a Prospective Payment System (PPS). See 42 C.F.R. Part 484. The PPS is based on a “national prospective 60-day episode payment,” a rate based on the average cost of care over a 60-day episode for the patient’s diagnostic group. Upon a physician’s referral, a Home Health Agency (HHA) is required to make an initial assessment visit and perform a comprehensive assessment encompassing the patient’s clinical, functional, and service characteristics. Accordingly, a registered nurse must evaluate the patient’s eligibility for Medicare home health care, including homebound status, and must determine the patient’s care needs using the Outcome and Assessment Set (OASIS) instrument. The OASIS diagnostic items describe the patient’s observable medical condition (clinical), physical capabilities (functional), and expected therapeutic needs (service). Based upon the OASIS information – and in turn upon the expected cost of caring for the patient – the patient’s “case mix assignment” is determined and the patient is assigned to one of eighty Home Health Resource Groups (HHRGs). The patient’s HHRG assignment and other OASIS information are represented by a Health Insurance Prospective Payment System (HIPPS) code that is used by Medicare to determine the rate of payment to the HHA for a given patient.
Once the HAA has submitted the patient’s OASIS information, partial payment is made based on a presumptive 60-day episode. In order to continue receiving covered care for another 60-day episode, the patient must be re-certified by a physician within the final five days of the initial episode as requiring and qualifying for home health care, and a new comprehensive assessment must be performed. The initial base rate may be subject to upward adjustment, such as where there is a “significant change in condition resulting in a new case-mix assignment,” or downward adjustment, such as where the number of predicted therapy visits substantially exceeds the number actually performed. Throughout the patient’s episode, the HHA is required to maintain clinical notes documenting the patient’s condition and the health services performed.
Home Health Fraud is a Major Concern.
From 2002 to 2006, spending by the United States on home health care rose a precipitous 44%, amounting to nearly $12.9 billion in 2006. According to a report by the Medicare Payment Advisory Commission, Home Health Agencies (HHAs) currently enjoy an average profit margin of nearly 16%. In light of the explosive growth in profits to private companies and cost to Medicare, abuse of the home health system has been identified by the Centers for Medicare & Medicaid Services as a major concern. In March 2009, the Government Accountability Office (GAO) published a report, “Improvements Needed to Address Improper Payments in Home Health,” which found that HHA fraud is in part to blame for the startling rise in home health spending.
Our Attorneys are National Qui Tam Experts and Trial Lawyers.
“The Accomplishments of Frohsin Barger & Walthall warrant the wealth of accolades that it has received.” — Benchmark Plaintiff
Jim Barger and Elliott Walthall are the only private attorneys general in the country ever to be tapped as part of a Department of Justice trial team in a Medicare fraud jury trial. A noted expert on the False Claims Act (FCA), Jim Barger teaches upper-level courses on the subject as an adjunct professor at the University of Alabama School of Law, which was ranked among the nation’s top 15 law schools by Business Insider in 2016. Barger has appeared on HuffPost Live, Fox 6 Atlanta, and National Public Radio and his opinions on FCA Medicare enforcement are regularly sought by major newspapers, including The New York Times and The Washington Post.
Both Jim Barger and Elliott Walthall have spoken on national panels about Medicare fraud for the American Bar Association, the American Association for Justice, and Taxpayers Against Fraud. In 2015, Barger was a featured symposium speaker on Medicare Fraud and the FCA at the Georgetown Law Center in Washington, DC. In 2016, Georgetown’s American Criminal Law Review published a new research article by Barger on the public-private partnership of the FCA.
Frohsin Barger & Walthall Represents Whistleblowers Nationwide.
Frohsin Barger & Walthall investigates and litigates qui tam actions on behalf of whistleblowers in federal and state actions across the country. Our representation includes evaluating, investigating, and filing qui tam actions, as well as assisting prosecutors and investigative agents in pursuing cases and reaching settlements, with a high percentage of our cases resulting in government intervention. We have sealed cases in multiple states across the country and regularly travel to meet with United States Attorney’s offices, State Attorney General Offices, and United States Department of Justice attorneys in Washington, DC.
The False Claims Act Offers Protection for Whistleblowers.
Blowing the whistle on corporate fraud takes courage, and the law rewards that courage with certain protections. We understand that one of the most important aspects of representing corporate whistleblowers is guiding and protecting them through the difficult, stressful process of litigation. The False Claims Act (FCA) provides for a whistleblower’s case to be filed under seal and the whistleblower’s identity to be protected during the course of the government’s investigation. Further, federal laws protect against retaliation by mandating the reinstatement of wrongfully fired employees at the same seniority level, as well as an award of double back-pay, interest, and attorneys’ fees. Finally, successful whistleblowers are entitled to up to 30% of any FCA recovery, which Congress has mandated is three times the amount of fraud that is proved through the whistleblower’s allegations, plus substantial civil penalties.