Jewish Healthcare Charity Settles Medicaid Fraud Suit For $47 Million
Beth Abraham CenterLight logoA Jewish healthcare charity founded by the Bertha Alperstein, the wife of Talmud scholar and Rabbi Abraham Alperstein, almost a century ago in his honor has agreed to repay $47 million to the State of New York and the US government to settle charges of Medicaid fraud. CenterLight Healthcare, previously the Beth Abraham Family of Health Services, was founded as Beth Abraham in 1920 to serve as a nursing home for the Jewish poor. It reportedly admitted this week to having over 1,200 ineligible members in its Medicaid-sponsored long term care plan.
New York State Attorney General Eric Schneiderman’s press release:
A.G. Schneiderman Announces $47 Million Settlement With Centerlight Healthcare For Fraudulently Using Social Day Care Centers To Enroll Ineligible Members
Centerlight Healthcare’s Select Medicaid Managed Long-Term Care Plan Improperly Billed Medicaid; NYS Medicaid Recovers $28 Million
Schneiderman: We Won’t Tolerate Companies That Seek To Exploit The System For Profit
NEW YORK – Attorney General Eric T. Schneiderman today announced a $47 million settlement with CenterLight Healthcare and CenterLight Health System, resolving allegations that CenterLight Healthcare’s Select Medicaid Managed Long Term Care Plan (“MLTCP”) fraudulently billed Medicaid for services they did not provide to more than 1,200 Medicaid recipients. Under the settlement, CenterLight Healthcare admitted that it enrolled Medicaid beneficiaries who were referred by social adult day care centers even though the beneficiaries were not eligible to receive managed long-term care under the plan, and that the centers were providing services that did not qualify for reimbursement under New York State Department of Health standards, or CenterLight’s contract with DOH. CenterLight receives over $3,000 a month per member from New York’s Medicaid program as part of its MLTCP. Under the settlement, New York’s Medicaid program will receive $28,050,652.04 and the United States will receive $18,700,434.70. The U.S. Department of Justice’s Southern District of New York reached a parallel agreement with CenterLight.
“It’s simple: CenterLight Health Care did not play by the rules,” Attorney General Schneiderman said. “We won’t tolerate companies that seek to exploit the system for profit. My office will continue to be vigilant in protecting Medicaid against fraud.”
In addition to its payment of the $47 million under the settlement, CenterLight is entering into two-year agreement with an independent compliance monitor and the Attorney General’s Medicaid Fraud Control Unit. That agreement requires CenterLight to comply with all terms of its MLTCP contract and DOH policies, and monitor and revise compliance policies if necessary.
The settlement arose out of an investigation initiated by the Attorney General’s Medicaid Fraud Control Unit and the New York State Office of the Medicaid Inspector General. It also resolved certain allegations in a whistleblower case filed in the United States District Court for the Southern District of New York, as well as certain self-disclosures made by CenterLight.
CenterLight Healthcare’s Select program is a Managed Long-Term Care Plan that has contracted with the New York State Department of Health to provide long-term community-based health care for members who are able to remain in their homes without jeopardy to their health or safety and are expected to need more than 120 days of in-home services, including nursing, therapy, home health service and personal care service. CenterLight admitted it billed Medicaid for services provided to 1,241 recipients who did not qualify for these services.
As part of the settlement, CenterLight also admitted that:
It enrolled Medicaid beneficiaries who were referred by social adult day care centers or who received services from them, even though they were not eligible to receive managed long-term care under the plan;
CenterLight used the day care centers to provide community-based MLTCP personal care services that did not qualify as personal care services under CenterLight’s Select plan.
This is the second settlement from the Attorney General’s Office involving a managed long-term care plan in New York, based on allegations that the managed long-term care plan enrolled members through social adult day care centers who were ineligible. In October 2014, the Attorney General announced a $37 million settlement with VNS Choice, Visiting Nurse Service of New York, and VNS Choice Community Care regarding similar allegation related to its MLTCP.
The Attorney General thanks New York Medicaid Inspector General Dennis Rosen for the work of his office on this matter. The Attorney General also thanks New York State Medicaid Director Jason A. Helgerson and his staff for their assistance and the United States Attorney’s Office for the Southern District of New York for its assistance in the investigation. A whistle-blower, David Heisler, provided valuable information through a “qui tam” action filed under the New York and federal False Claims Acts, and will receive an award for his contribution to the investigation.
The investigation was principally conducted by Associate Special Auditor Investigator Svetlana Volchyok and Associate Special Auditor Investigator Milan Shah, Senior Investigator Wayne Rivers, and Data Analyst Nicholas Furnari.
The case is being handled by Senior Counsel Carolyn T. Ellis and Special Assistant Attorney Alee N. Scott of the Medicaid Fraud Control Unit Civil Enforcement Division. The Medicaid Fraud Control Unit is led by Acting Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney. The Division of Criminal Justice is led by Executive Deputy Attorney General Kelly Donovan.
US Attorney Preet Bharara’s press release:
Department of Justice
U.S. Attorney’s Office
Southern District of New York
FOR IMMEDIATE RELEASE
Thursday, January 21, 2016
Manhattan U.S. Attorney Announces $46.7 Million Settlement Of Civil Fraud Claims Against Centerlight Healthcare For Enrollment Of Ineligible Individuals In Medicaid Managed Long-Term Care Plan
CenterLight Healthcare Admits Collecting Medicaid Payments for 1,241 Ineligible Managed Long-Term Care Plan Members Who Attended or Were Referred by Social Adult Day Centers
Preet Bharara, the United States Attorney for the Southern District of New York, and Scott J. Lampert, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General’s New York Region (“HHS-OIG”), announced today that the United States has settled civil fraud claims under the False Claims Act against CenterLight Healthcare, Inc., and CenterLight Health System, Inc. (collectively, “CenterLight”), for the enrollment of ineligible members in the CenterLight Healthcare managed long-term care plan (“CenterLight MLTCP”). CenterLight improperly billed the Medicaid program for 1,241 members who attended or were referred by social adult day care centers (“SADCCs”) and whose needs did not meet the criteria of the managed care plan. The settlement resolves claims that CenterLight engaged in improper marketing practices to enroll members through SADCCs and induced such members to use SADCCs as the members’ primary source of personal care services. CenterLight continued to seek and obtain monthly capitation payments for members well after the New York State Department of Health issued guidance in early 2013 explicitly stating that an individual’s attendance at SADCCs does not satisfy the MLTCP eligibility standard.
Under the terms of the settlement approved yesterday by United States District Judge Lewis A. Kaplan, CenterLight must pay a total of $46,751,086.74 to the Medicaid Program, $18,700,434.70 of which will go to the United States. In addition, CenterLight is required to:
Comply with all contractual and regulatory requirements governing the enrollment, assessment, re-assessment, and dis-enrollment of CenterLight MLTCP members.
Credential only SADCCs that are properly certified and capable of providing community-based personal care services consistent with regulatory requirements.
Monitor SADCCs in its provider network to ensure that they furnish the community-based personal care services called for under CenterLight MLTCP member care plans and operate in compliance with applicable regulations.
Prohibit marketing practices that are directed at enrolling CenterLight MLTCP members through SADCCs.
Manhattan U.S. Attorney Preet Bharara said: “CenterLight Healthcare improperly received millions of Medicaid dollars by enrolling ineligible members into its managed care plan. With this settlement, CenterLight now has admitted to its conduct and will pay over $46 million. We are committed to holding health care providers accountable if they wrongfully seek and receive federal funds, and we thank HHS’s Office of the Inspector General and the New York State Attorney General’s Office for their assistance.”
HHS-OIG Special Agent in Charge Scott J. Lampert said: “CenterLight’s conduct compromised the integrity of the Medicaid program by enrolling beneficiaries in a plan for which they were not eligible. HHS-OIG is committed to holding providers accountable for their practices, and the manner in which care is provided.”
Pursuant to the Medicaid managed long-term care program, health care providers, such as CenterLight, are responsible for arranging and managing long-term health care services offered to Medicaid beneficiaries. In exchange, providers receive a monthly capitation payment of approximately $3,800 for each beneficiary enrolled in the health care plan. MLTCPs offer a variety of services, including assistance with activities of daily living, care management services, skilled nursing services, physical therapy, occupational therapy, speech therapy, nursing home care, and preventive services. In order to qualify for enrollment in an MLTCP, Medicaid beneficiaries need to, among other things, be eligible for a nursing home level of care and require at least 120 days of community-based long-term care, which includes a wide range of health care services such as personal care services. CenterLight contracted with SADCCs to provide care, including personal care services, to CenterLight MLTCP members.
In the settlement agreement, CenterLight admits that 1,241 CenterLight MLTC members who had been referred by SADCCs or had used SADCC services were not eligible to be members of the managed care plan. Many of these ineligible members were not eligible at the time of their initial enrollment, while others were ineligible to remain in the managed care plan at the time of their re-assessment but were not dis-enrolled in a timely manner. Although the SADCCs were supposed to be providing care to CenterLight members, CenterLight admits that various SADCCs in its provider network did not provide services that qualified as personal care services under the terms of its Medicaid contract or were not legally permitted to provide such services.
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Mr. Bharara thanked HHS’s Office of the Inspector General for its assistance with the case. Mr. Bharara also thanked the Medicaid Fraud Control Unit of the New York State Attorney General’s Office for its investigative efforts and assistance.
The case is being handled by the Office’s Civil Frauds Unit. Assistant U.S. Attorney Jeffrey K. Powell is in charge of the case.