Life Care files for dismissal of claims
by DAVID DAVIS, Managing Editor
Mar 05, 2013 | 2429 views | 0 0 comments | 10 10 recommendations | email to a friend | print
Life Care Centers of America attorneys filed a motion Friday to dismiss allegations of fraud filed against the Cleveland-based company in U.S. District Court in Chattanooga.

Life Care attorneys requested in a five-page motion that District Judge Harry Mattice dismiss the federal government’s claims in their entirety because prosecutors do not allege any violation of statutes and regulations relating to requirements of medical necessity. A 53-page supporting document accompanied the motion.

The motion specifically addresses counts one and two. It states the complaint fails to allege any “objectively false” claim for payment in the first count, “because the complaint does not, and cannot, allege any objective criteria or standard to verify when rehabilitation therapy is ‘medically necessary’ or ‘skilled.’” The second count fails to allege any “false statements or records.” There is no allegation the data indicating the number of therapy minutes provided to each patient was false, inaccurate or that LCCA did not actually provide all of the therapy services identified.

According to the motion, both counts one and two fail to specify which one or more of LCCA’s more than 200 facilities are at issue. It is also claimed they fail to identify any actual claim submitted to the government that was “false” as a result of the alleged “corporate pressure.”

Continuing, the complaint failed to specify the operative dates relating to any of the supposedly fraudulent schemes and practices; or any person or any category of individuals engaged in fraudulent conduct.

Also, the government failed to identify what specifically was false about LCCA’s claims for payment to the government by alleging the number of minutes exceeded “medically necessary” therapy.

Life Care attorneys claimed the government violated the False Claims Act by engaging in unchecked and one-sided discovery in an attempt to bolster its claims. Prosecutors also improperly delayed intervening in attempts to increase the scope of potential liability and damage claims against LCCA.

Federal prosecutors are seeking actual damages to be determined at a trial to be set later. Life Care is charged with five counts, including violation of the False Claims Act and for unjust enrichment by retaining monies to which it was not entitled.

Federal prosecutors allege Life Care submitted millions of dollars in false claims for payment. Life Care stated in an open letter to employees in January that its practices have resulted in significant savings to the Medicare program — potentially $400 million for the period of 2006-10.

The case comes from two whistleblower suits from two former employees. One came out of the Southern District of Florida filed in 2008 by Tammie Johnson Taylor. The second was filed by Glenda Martin, who worked at Life Care Heritage Center in Morristown from 1993 through 2007, and as interim director of nursing at various other Life Care facilities. Through her employment, she gained firsthand knowledge of company practices.

The suit alleges Life Care was able to control the type and amount of therapy provided to patients. Patients generally arrive at a health care facility with a generic note from a physician indicating the patient is to be evaluated for physical, occupational or speech therapy. Life Care personnel prepared therapy plans that were submitted to a physician who, in most cases, was the medical director of the facility.

Prosecutors allege corporate pressure was placed on staff. Also, Life Care often falsely documented treatment in order to justify higher reimbursement and in other instances, therapy was given to patients though they received no benefit from therapy, prosecutors stated.