On October 18, the Department of Justice announced that for-profit home health provider Carter Healthcare LLC, along with its affiliates CHC Holdings and Carter-Florida (collectively Carter Healthcare), their President Stanley Carter, and Chief Operations Officer Bradley Carter will pay $7.175 million to settle allegations that they violated the False Claims Act by fraudulently billing the Medicare program. 

Between 2014 and 2016, Carter Healthcare allegedly billed the Medicare Program “knowingly and improperly” for medically unnecessary therapy provided to patients in Florida and overbilled for therapy by upcoding patients’ diagnoses. 

Bradley Carter will pay $175,000, Stanley Carter will pay $75,000, and Carter Healthcare will pay the remaining $6.925 million of the settlement. Also, as part of the settlement, both Stanley Carter and Bradley Carter are excluded from participation in all Federal health care programs for a statutory period of five years. Additionally, Carter Healthcare is now bound by the terms of a “corporate integrity agreement” that requires the company to implement compliance measures.

Former employees of Carter Healthcare, Mahaffey and Mark Brimer, brought the claims under the qui tam or whistleblower provisions of the False Claims Act which enable private citizens to file lawsuits on behalf of the government if they know of an individual or company defrauding the government. Qui tam whistleblowers are eligible to receive between 15 and 30% of the government’s recovery, if one occurs. Together, Mahaffey and Brimer will receive $1.3 million of the settlement.

Contemporaneous with this settlement, Carter Healthcare has agreed to pay an additional $22,948,004.54 to resolve another qui tam action brought in the Western District of Oklahoma, which alleged that Carter Healthcare improperly paid remuneration to its home health medical directors in Oklahoma and Texas for the purpose of inducing referrals.

The attorneys at Chilivis Grubman represent clients of all types and sizes in connection with criminal healthcare fraud and government investigations. If you need assistance with such a matter, please contact us today.