Kindred Healthcare to Pay $125 million to Settle U.S. Allegations Over Therapy ServicesJanuary 20, 2016
Kindred Healthcare Inc. agreed to pay $125 million to settle federal allegations it provided unnecessary therapy services to nursing-home patients as part of a scheme to overbill the federal Medicare program, according to the agreement finalized on Tuesday.
Several nursing homes that hired Kindred’s therapy unit, RehabCare, to provide services to their residents separately agreed to pay the federal government about $8 million for their role in the alleged scheme.
Kindred said it agreed to the settlement to avoid costly and distracting litigation, but denied wrongdoing.
A Kindred spokesman didn’t respond to a request for comment Tuesday.
The Wall Street Journal in August reported on how Kindred and other nursing-home operators and contractors increased the share of days they billed for giving patients’ the highest therapy level Medicare will cover—so-called ultrahigh therapy. In 2013, Kindred’s own nursing homes billed for ultrahigh therapy 58% of the time, compared with 7.6% of the time in 2002.
Nursing-home therapists had told the Journal at the time that Kindred and other nursing-home operators pressured them to provide intensive services, even when patients couldn’t participate in the treatment and were unresponsive.
The suit Kindred settled on Tuesday was focused on services provided under contract to nursing homes by RehabCare, which Kindred acquired in 2011. The suit alleged the company overbilled Medicare between Jan. 1, 2009 and Sept. 30, 2013.
The Justice Department alleged Kindred presumptively placed patients in the ultrahigh category, which requires 720 minutes of therapy a week. They said Kindred reported therapy minutes had been provided when patients were sleeping or unable to benefit from the treatment, among other allegations.