Alabama’s SouthernCare Inc. settles False Claims Act allegations

SouthernCare Inc.has conceded to pay a hefty settlement to the United States to resolve allegations that the company submitted false claims in connection with Medicare patients treated at its hospice facilities. Based in Birmingham, Alabama, SouthernCare has nearly one hundred locations in fifteen states. As part of the agreement, SouthernCare will submit to government oversight under a Corporate Integrity Agreement with the Office of Inspector General of the Department of Health and Human Services.

Hospice facilities provide medical care or treatment aimed at reducing the severity of a patient’s symptoms when disease can no longer be cured. Medicare will pay for hospice care only when a patient has a terminal prognosis and is expected to live six months or less. Government investigators charged that SouthernCare was submitting false claims to Medicare for patients who were not eligible for hospice care.

SouthernCare’s practices were revealed by two former employees who filed Qui Tam lawsuits under the federal False Claims Act. That statute empowers private parties to file suit on the government’s behalf against those who defraud the United States. The Qui Tam section of the Act allows such whistleblowers to participate in any recovery. The whistleblowers in the SouthernCare suit will receive handsome rewards under that provision.
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For the full story, go to the Department of Justice’s Press Release.