[co-authors: Stephanie Kozol*, Nick Gouverneur]
This month, two attorneys general (AGs) have settled False Claims Act investigations with two separate companies in the health care industry. Both settlements were notable in their own right.
On December 2, North Carolina AG Josh Stein announced a $2,505,000 settlement with Southeastern Behavioral Healthcare Services, LLC (Southeastern) to resolve allegations that the company submitted false claims to the North Carolina Medicaid program.
Stein accused Southeastern of billing Medicaid for services not provided, unnecessary services, or services for patients who were incarcerated, deceased, or for whom no medical records existed. Stein worked with the U.S. Attorney’s Office for the Eastern District of North Carolina, the Office of Inspector General of the U.S. Department of Health and Human Services, and the North Carolina AG’s Medicaid Investigations Division to secure this result. The consortium of government investigators found that the alleged fraudulent activities took place over several years between March 2016 and July 2020.
Connecticut AG William Tong, in collaboration with U.S. Attorney Vanessa Roberts Avery, announced his own settlement on December 5. Home Care VNA LLC (Home Care) agreed to pay $361,520 to settle an investigation involving allegations that the company violated Medicaid regulations. This is not Home Care’s first run-in with state AGs; in 2022, Home Care paid $630,000 to settle former AG and current Governor of Massachusetts Maura Healey’s investigation into similar Medicaid fraud allegations. The allegations brought forth by Tong involve Home Care’s submission of claims in violation of Connecticut’s regulations, which mandate that each patient must have a plan of care signed by a licensed practitioner within 21 days of starting care, and these plans must be reviewed and updated every 60 days. The settlement addresses claims submitted between August 1, 2018, and March 26, 2020.
Why It Matters
AGs are increasingly wielding their authority under state false claims acts to pursue fraud on the government — and more frequently working with other regulators at the state and federal levels to do so. These settlements underscore the importance of ensuring that requests for payment from the state, or submission of monies owed to the state, are in strict compliance with legal obligations and requirements. The Home Care settlement also emphasizes the importance of avoiding repeat offenses by engaging in damage control following a public settlement, as a company’s potential exposure tends to increase with regulatory attention.
*Senior Government Relations Manager
