Interface Rehab: The Contractor Paid by the Minute

In the Interface Rehab fraud case, the therapy contractor agreed to pay $2 million over allegations that it pressured therapists to meet Medicare revenue targets through unnecessary Ultra High treatment. According to the whistleblower’s complaint, Interface earned money for each minute of therapy. A former rehabilitation director described instructions to start at the highest treatment category and records that did not match the care he saw.

The Department of Justice announced the settlement on July 23, 2021. Interface was a rehabilitation contractor based in Placentia, California, providing physical, occupational and speech therapy. The former director brought the qui tam case under the False Claims Act. Interface’s resolution followed a separate settlement with Longwood Management, the nursing facility operator that hired it.

Ultra High Therapy Driven by Revenue Targets

The government alleged that Interface pushed unnecessary Ultra High rehabilitation for Medicare Part A residents from January 1, 2006, through October 10, 2014. Its account puts the revenue target before the patient’s treatment needs: Interface allegedly pressured therapists to increase therapy until a high percentage of residents qualified for the highest reimbursement category.

During that period, Medicare paid skilled nursing facilities a daily rate reflecting patients’ therapy and nursing needs. Ultra High required at least 720 minutes of skilled therapy a week from two disciplines, with one provided five days a week. Physical, occupational and speech therapy were the relevant disciplines. Moving a resident into that category increased the facility’s Medicare reimbursement.

The government’s allegation was that the targets could only be met by disregarding individual needs. An instruction about departmental revenue could reach all the way into a therapist’s decision about how much treatment a patient received. The alleged result: residents received health care they did not need, and taxpayers paid for it.

The Contract Put a Price on Each Minute

The whistleblower alleged that Longwood Management paid Interface by the minute to manage rehabilitation services. Interface employees evaluated patients for rehabilitation, while Longwood employees provided their medical and nursing care. The complaint describes the contract and the division of work inside the same facilities.

The California Research Bureau’s 1997 report, Fraud and Abuse in the Health Care Market of California, explains how payment for each service rewards greater treatment volume. The arrangement alleged here put that incentive beside Medicare’s payment categories: additional therapy minutes earned the contractor more money and could move a resident into a higher-paying category for the facility.

The complaint’s account of Interface’s orientation materials shows how that incentive allegedly reached staff:

That is an extraordinary starting point for a patient evaluation. The payment category was already selected. The whistleblower further alleged that evaluating therapists could not assign a lower level, and that attempts to reduce it prompted review by the Longwood administrator and Interface regional manager.

What the Complaint Says the Records Showed

The complaint connected the alleged instructions to a weekly report and observations of actual treatment. It said Interface’s September 9, 2012 report listed 300 patients across Longwood Management facilities, with 220 assigned to the ultra level and none assigned to low therapy.

His account of treatment was much less intensive than the categories suggested:

The alleged difference was between time recorded as therapy and time spent receiving it. The complaint also alleged that licensed Interface therapists performed tasks Longwood nurses could have handled, increasing daily Medicare reimbursement through the choice of staff.

Another episode concerned treatment that appeared in the records after the whistleblower declined to provide it. According to the complaint, he was awaiting his California physical therapy license and refused to treat patients without appropriate supervision. He saw no therapists present when he left. About two days later, therapy appeared in those patients’ records.

He said the entries were out of normal chronological order and alleged that the patients had received no rehabilitation therapy, yet the services were billed. The complaint separately said Interface managers assured him that “phone supervision” was adequate.

Interface and Longwood Had Separate Settlements

Longwood Management agreed to pay $16.7 million in the settlement announced on July 13, 2020. That resolution addressed allegations of unnecessary rehabilitation driven by preplanned revenue targets. Interface’s later settlement addressed the contractor’s role in the alleged conduct.

The Interface announcement identified 11 facilities where the disputed claims arose. These facilities also appear in Longwood’s covered facility list. The overlap connects the cases, while the separate settlements show how the government pursued the operator and contractor for their respective roles.

Why the Payment Era Matters

Interface’s alleged conduct fell under the historical Resource Utilization Group system, where therapy minutes helped determine the payment category. Medicare Part A replaced that system with the Patient Driven Payment Model on October 1, 2019. The replacement bases classification on patient characteristics and clinical needs.

What Evidence Is Needed to Prove Fraud?

In a therapy case like Interface’s, useful evidence connects the contractor’s instructions and payment arrangement to patient care, recorded treatment and the Medicare claim. Here, the complaint identified a contract, orientation materials, weekly therapy reports, staff observations and treatment entries whose timing the whistleblower disputed.

Those records answer different parts of the same question. The contract explains the financial incentive. The orientation materials and management response show who directed the therapy category. Patient evaluations, supervision records and treatment notes show how those instructions reached care. The facility’s assessments and billing records connect that care to the amount claimed from Medicare. Our whistleblower experts work with you to bring those parts together.

How Much Does a Medicare Fraud Whistleblower Get Paid?

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. In the Interface case, the Justice Department announced that the former rehabilitation director would receive a share of the settlement proceeds.

You Saw How the Therapy Target Reached the Chart

If you worked in rehabilitation or facility billing and saw a revenue target override a patient’s treatment needs, speak with our whistleblower experts. We build your case around the decisions and records you know, bring in healthcare fraud whistleblower lawyers who understand therapy billing, and stay beside you throughout the case.