Brius San Diego Nursing Homes: Consultation Fees for Sending Patients

In the Brius San Diego nursing homes fraud case, four facilities agreed to pay up to $6,926,917 to resolve allegations of buying hospital referrals and billing Medicare and Medi-Cal for the resulting care. The whistleblower’s complaint described cash, gift cards and monthly payments presented as consultation fees. For someone working in hospital discharge planning or nursing-home marketing, the connection between a payment and an admission is the heart of this case.

The Justice Department announced the civil settlement on November 16, 2017. Its headline amount combined fixed payments with a much larger amount dependent on the facilities’ operations.

What the San Diego Nursing Homes Were Accused Of

The government alleged that employees paid discharge planners at Scripps Mercy Hospital San Diego to send patients to the nursing homes. The whistleblower’s complaint described how referral payments could look like ordinary business expenses:

The alleged consultation fee bought admissions: $500 for every two Medicare patients referred. The complaint described monthly compensation, cash and gift cards tied to referrals, and party invitations conditioned on bringing patients to the facilities. It also alleged that a hospital employee was offered a job whose only function was providing referrals. She declined.

Another episode showed the hospital receiving an internal warning. According to the complaint, a nursing-home marketing director handed cash to a Scripps Mercy case manager, who took it to her supervisors. The hospital investigated and barred the marketing director from entering the floors of Scripps facilities.

Which Brius Nursing Homes Settled?

Four nursing homes owned by Los Angeles-based Brius Management Co. entered the civil settlement. The facility names and the entities identified in the case were:

• Point Loma Convalescent Hospital: Point Loma Rehabilitation Center LLC.
• Brighton Place San Diego: B-San Diego LLC.
• Brighton Place Spring Valley: B-Spring Valley LLC.
• Amaya Springs Health Care Center: B-East.

The original complaint used the name Presidio Health Care Center for B-East, LLC. The settlement announcement identified Amaya Springs Health Care Center in Spring Valley. Those names help a former employee recognize the facility behind the company paperwork.

The complaint also named Brius Management Co. and Brius LLC. The civil payment terms announced by the Justice Department belonged to the four nursing homes. For an insider, the useful distinction is who employed the marketer, who authorized the payment and which facility billed for the referred patient’s care.

How a Hospital Referral Became a Public Claim

The alleged referral payments brought patients into the facilities. The Medicare and Medi-Cal bills for their care supplied the public-money connection. The Justice Department described the civil case as involving claims for services provided to patients referred from Scripps Mercy Hospital.

The complaint explained why Medicare referrals were worth buying. It alleged that the facilities paid an internal medicine physician for Medicare referrals and moved Medi-Cal residents to other facilities to make room for the higher-paying patients. According to the complaint, those transfers disregarded residents’ needs. The complaint also described the cost to honest facilities: they lost business to competitors buying referrals.

The alleged arrangements extended beyond Scripps Mercy. The complaint described a Kindred Hospital marketing director hired to provide referrals for $4,000 per month. It also alleged payments in the other direction: Nightingale Home Health provided traveler’s checks in exchange for residents discharged from the nursing homes. The facilities allegedly paid to bring patients in and accepted payments to send them on.

The California Research Bureau’s 1997 report, Fraud and Abuse in the Health Care Market of California, described referral kickbacks as channeling business to another party for a fee. That older industry analysis helps explain the relationship alleged here: the person influencing the destination receives the benefit, while the receiving facility gains the business. A referral payment can affect the health care purchase before a billing employee ever sees the claim.

A separate case shows the same incentive running in another direction. In the Regent Management Services settlement, the government alleged that ambulance companies supplied free or heavily discounted transports in exchange for more lucrative Medicare and Medicaid referrals. Regent would otherwise have borne higher transport costs. There, the alleged benefit was an expense saved by the nursing-home business. Here, the civil allegations concerned benefits paid to hospital discharge planners. In both, control over where patients went carried a price.

What the Settlement Amount Actually Covered

The fixed federal obligation was $1,785,967, payable in three annual installments. California’s fixed payment was a $240,950 lump sum. The Justice Department reported that the facilities paid the first federal installment on November 6, 2017, and California received its payment on November 10.

The additional federal payment could reach $4.9 million if specified operational contingencies were met. That conditional amount was the larger part of the announced settlement ceiling.

The release also reported that the four facilities entered corporate integrity agreements with the Department of Health and Human Services.

What Evidence Is Needed to Prove Fraud?

For a referral-payment case, the evidence connects the benefit, the person receiving it, the resulting admission and the public-program claim. We work with insiders to establish those connections across the marketing, hospital and billing records.

A former nursing-home employee brought the Brius case. Her complaint identified her role as director of marketing at Brighton Place Spring Valley, responsible for making hospitals aware of the facility so they would send appropriate discharged patients there. That role put her inside the referral business.

The complaint alleged a conversation about which hospital case managers were on the facilities’ payroll, how much they received and how many referrals they brought in. That is a concrete connection between compensation and business. It gives a payroll entry or consulting agreement significance beyond the label attached to it.

For someone with similar knowledge, we examine who arranged and approved the benefit, what work the payment supposedly covered, and how the referral reached the receiving facility. A marketing employee may know the arrangement while a billing employee may know the claims it generated. We build the account around how those pieces fit together.

What Is the Reward for a Medicare Fraud Whistleblower?

In the Brius case, the whistleblower was allocated 20% of each settlement payment. The reward was tied to payments, including any contingent amount paid under the agreement.

A whistleblower case under the federal False Claims Act can pay 15% to 30% of what the government recovers.

You Know What the Referral Payment Bought

If you worked in discharge planning, nursing-home marketing or billing and know how a benefit brought patients through the door, talk with our whistleblower experts about the arrangement. We develop your account into a healthcare fraud case with nursing-home whistleblower lawyers who understand referral payments, and stand beside you from the first conversation through the pursuit of a recovery.