Whistleblowers don’t have to suffer a bite from a radioactive spider to detect and report fraudsters. Two home healthcare companies in two different states recently settled with both the Department of Justice and those states for submitting false claims to state Medicaid programs. Academy Health Care Services of Dayton, Ohio settled with the Department of Justice for $500,000, and Home Care VNA of Chicopee, Massachusetts settled with the Commonwealth of Massachusetts for $630,000 at the beginning of 2022. Under the federal False Claims Act, a whistleblower is entitled to receive 15-25% of the government’s recovery. Under the Massachusetts False Claims Act, as with the federal False Claims Act, a private individual can sue on behalf of the government and receive a percentage of the proceeds.

According to the allegations, the Ohio home health care company bilked the Ohio Medicaid program by falsely billing the state Medicaid program for services purportedly provided in individual settings, thus garnering a higher reimbursement, when the services were actually provided in group settings. The service providers did not spend the requisite time with patients which would qualify for the higher reimbursement, as well. For receiving reimbursement from the Ohio Medicaid program over the course of three years, the provider must pay $500,000 in fines, half of which is restitution, must cease operations by mid-2022, and cease providing services to beneficiaries of federal healthcare and the Ohio Medicaid programs.

In Massachusetts, the Attorney General (AG)’s Office has concentrated their efforts on investigating fraud in the home health industry, recovering over $42 million for MassHealth since 2016. According to the allegations, Home Care VNA submitted claims to MassHealth for services that were not medically necessary and knowingly retained overpayments from MassHealth. In 2020, the owners of Home Care VNA settled allegations of falsely billing MassHealth for another home healthcare company, resulting in a $3.1 million settlement. MassHealth referred the home healthcare agency to the AG’s office. MassHealth requires stringent recordkeeping for home health services, called a plan of care, and a MassHealth beneficiary’s physician must review and sign the plan of care.

Medicaid is funded by both state and federal governments. Federal funds for state medical assistance programs are designated “Federal Medical Assistance Percentages” (FMAPs) and the Secretary of Health and Human Services (HHS) annually determines these amounts. Fraudulent manipulation of state Medicaid programs can affect the amount of federal matching funds states receive to support their healthcare programs.

The Department of Justice and the States need whistleblowers to report fraud involving home healthcare providers submitting false claims to Medicaid.