Glendale, California physical therapy company settles False Claims Act suit involving fraudulent billings

Interstate Rehabilitation LLC, a physical therapy company that contracts with several southern California hospitals, has paid the government a sizable settlement to resolve a whistleblower lawsuit alleging that the company submitted false claims to Medicare. The lawsuit alleged that from 1998 to 2002, Interstate Rehabilitation violated Medicare rules by allowing clerical employees to give physical therapy services when a licensed physical therapist was not present. Claims for such services were then submitted to Medicare. The practice took place at California Hospital Medical Center, East Los Angeles Doctors Hospital, Community Hospital of Gardena, Bay Harbor East Hospital, Bay Harbor West Hospital, VitalCare Skilled Nursing Facility, Hemet Valley Medical Center, Santa Teresita Hospital, St. Vincent Medical Center, Memorial Hospital of Gardena and Doheny Villa Skilled Nursing Facility.

The whistleblowers in the case were Sonia Sarmiento and Janine Gostel, former Interstate Rehabilitation employees who will participate in the government’s recovery, as mandated in the Qui Tam provisions of the False Claims Act.

For the full story, see the Department of Justice’s Press Release.