Kentucky, along with seven other states, has reached a settlement agreement with the nursing home operator Extendicare for $28 million. The U.S. Department of Justice, which worked the investigation with the states, called the settlement “the largest failure-of-care settlement with a chain-wide skilled nursing facility in the Department’s history.”
The case was filed against Extendicare Health Services and its subsidiary, Progressive Step Corporation – also called “ProStep,” which is a rehab services company. Extendicare is an Ontario, Canada company. Its U.S. subsidiary Extendicare Health Services, Inc. is headquartered in Milwaukee, Wisconsin. It operates 146 skilled nursing facilities in 11 states.
The allegations cover the time period from 2007 to 2013. Overall, the charges are that that the companies wrongfully billed Medicaid and Medicare for substandard services provided to their residents. The specific allegations include charges that the companies:
- billed both Medicaid and Medicare for what turned out to be materially substandard skilled nursing services;
- failed to meet federal and state standards of care;
- failed to have enough skilled nurses on staff to properly care for skilled nursing residents;
- failed to provide proper catheter care to some residents; and
- failed to follow protocols for preventing falls and pressure ulcers.
The states making the allegations were Kentucky, Indiana, Michigan, Minnesota, Ohio, Pennsylvania, Washington and Wisconsin.
Under the agreement, Extendicare and ProStep will pay $28 million to address the allegations of substandard services. About $15 million of that will go to Medicaid and $13 million to Medicare. Attorney General Jack Conway’s office reports that Kentucky’s portion of the settlement will be $1,246,978, of which the federal government will receive $905,587. Other states involved in the litigation have similarly worked out recovery payment amounts for their state programs.
The agreement also requires Extendicare to pay an additional $10 million to resolve federal allegations of illegal over-billing of federal Medicare claims.
In agreeing to settle the charges, the companies do not have to admit to any wrongdoing.
The companies are required, however, to comply with a five-year Corporate Integrity Agreement with the Office of Inspector General for the U.S. Department of Health and Human Services. The Corporate Integrity Agreement requires the companies to institute comprehensive compliance programs to ensure quality care.