Health care companies agree to pay $2.7 million - | Chattanooga News, Weather & Sports

Health care companies agree to pay $2.7 million

CHATTANOOGA, Tenn. (AP) - A Chattanooga-based company that runs nursing homes in several states and 1 of its affiliated firms has agreed to pay $2.7 million plus interest to settle allegations that they overbilled Medicare and other government-run health care programs.

The U.S. Justice Department announced on Friday that Grace Healthcare LLC and Grace Ancillary Services stood accused of providing medically unnecessary physical, occupational and speech therapy so they could bill the government for the maximum amount.

The allegations stem from a lawsuit filed by a former employee who sued under the Whistleblower provisions of the False Claims Act. The lawsuit claimed the nursing home company pressured therapists to increase the amount of therapy for each patient for billing purposes and not for the patient's need.

The deal gives the whistleblower $405,000 of the settlement.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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