Louisiana-Based LHC Group Inc. Agrees to Pay U.S. $65 Million to Resolve False Claims Act Allegations

WASHINGTON - LHC Group Inc. has agreed to pay $65 million, plus interest, to the federal government to resolve allegations that it violated the False Claims Act for false home healthcare billings to the Medicare, TRICARE and Federal Employees Health Benefits programs, the Justice Department announced today. The company also agreed to be bound by the terms of a Corporate Integrity Agreement with the Department of Health and Human Services – Office of Inspector General (HHS-OIG).

LHC, which is based in Lafayette, La., is one of the nation’s largest home health providers. The settlement resolves allegations that, between 2006 and 2008, LHC improperly billed for services that were not medically necessary and for services rendered to patients who were not homebound. Under the False Claims Act, private citizens, known as relators, can bring suit on behalf of the United States and share in any recovery. The relator, Judy Master, will receive over $12 million as her share of the government’s recovery.

“Billing for unnecessary home health services misuses taxpayer dollars because it wastes resources that should be available for patients who are truly in need,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “As we work hard to spend our public health care dollars efficiently, settlements like this help us maintain critical health care programs.”

“The U.S. Attorney’s Office is committed to investigating and aggressively pursuing healthcare providers who seek public funds through unlawful means. This settlement should send a message to all healthcare providers in the Western District of Louisiana, particularly home health providers, that violations of the False Claims Act will continue to receive this office’s full attention and resources,” said Stephanie A. Finley, U.S. Attorney for the Western District of Louisiana.

“Let this case warn health care providers of the risks of failing to adopt effective compliance plans.  When providers submit false claims to Medicare, the government will hold them accountable,” said Daniel R. Levinson, HHS Inspector General.  “OIG will oversee an integrity agreement with LHC that requires a review of how LHC corrects problems uncovered by audits to prevent future fraud.”

The United States’ investigation was conducted by the U.S. Attorney’s Office for the Western District of Louisiana, the Civil Division of the Department of Justice, HHS-OIG and the Office of Personnel Management’s Office of Inspector General with additional assistance provided by the Department of Defense’s Office of Inspector General.

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of HHS in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $6 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are more than $7.8 billion.

The case is docketed as United States ex rel. Master v. LHC Group, Inc., No. 07-1117 (W.D. La.).