Quality Therapy & Consultation: Therapy the Residents Did Not Need

The Quality Therapy & Consultation fraud case led to a $9.7 million civil resolution over allegations of RUG upcoding and therapy residents did not need or could not benefit from. The government alleged that the therapy supplier, its owner and four nursing facilities worked together to increase Medicare payments. Residents allegedly received therapy they could not use, and taxpayers paid for it. The alleged scheme put the reimbursement target ahead of the resident’s need for treatment.

The U.S. Attorney’s Office in Chicago announced the resolution on June 11, 2019. Quality Therapy had operated in Orland Park, Illinois. A former Quality Therapy employee brought the False Claims Act qui tam case, and the government joined it before the resolution.

What the Government Alleged

The government alleged that Quality Therapy and the nursing facilities inflated residents’ Resource Utilization Group scores to increase Medicare reimbursement. Under that payment system, a resident’s RUG score reflected physical, occupational and speech rehabilitation, along with the complexity of skilled nursing care. A higher score brought the nursing facility a higher payment.

The allegations reached the treatment itself. According to the Justice Department, the providers delivered skilled therapy to residents who did not need it or could not benefit from it, seeking the highest possible Medicare payment.

The Office of Inspector General’s account adds a more specific allegation about the paperwork. The owner and president was an occupational therapist. OIG alleged that Quality Therapy, at the owner’s direction, provided medically unnecessary services, altered medical records and upcoded RUG scores. That connects the clinical decision to the record used to support payment.

Medicare replaced RUG-IV with the Patient Driven Payment Model for covered Part A skilled nursing stays on October 1, 2019. Patient characteristics and clinical needs became the basis for classification in place of therapy-minute groups.

The Facility’s Claim and the Therapy Company’s Work

The government’s allegations joined the treatment supplier to the nursing facilities receiving the Medicare payments. The facilities were The Carlton at the Lake, Ridgeview Rehab and Nursing Center, Lake Shore Healthcare and Rehabilitation Centre, and Balmoral Home.

Therapists assess residents and deliver care. Physicians supply orders for treatment, while the staff caring for the resident supply observations from across shifts. A registered nurse coordinates or conducts the resident assessment, drawing on observations and contributions from the care team. The facility is the Medicare program participant. The Minimum Data Set assessment brings clinical information into the payment process, but the completed form still needs the underlying observations and treatment records to support it.

An outside therapy company can therefore influence the information behind a facility’s claim. Our experts work with insiders to establish who set the therapy plan, who controlled the assessment and who knew what reached billing. The therapy contract and the care records describe different parts of that relationship.

What Evidence Is Needed to Prove Fraud?

For a therapy billing case, the proof lies in how the care and the claim fit together. Our experts work through that connection with you, from the resident’s condition to the people directing the work. A therapist’s notes, physician orders, treatment logs and the assessment can tell different versions of the same stay.

A separate government complaint against Life Care Centers of America shows why an internal instruction can matter. The government quoted a rehabilitation manager’s direction to staff:

In that allegation, the billing category dictated the minutes staff were told to preserve. An insider who saw those instructions would understand something a completed claim alone could never explain.

A clinical employee may understand why the therapy lacked a purpose, while an assessment or billing employee may know how the same treatment became a higher-paying claim. Those different views of the same stay are why experience inside healthcare billing and direct care both matter.

Separate Payment Obligations and Exclusions

The civil resolution reached both the supplier and the facilities that billed Medicare. Quality Therapy agreed to pay $1.09 million, compared with $3.63 million from The Carlton at the Lake alone. The supplier’s payment was only one part of the total announced in the case.

OIG reported that on October 11, 2018, Quality Therapy agreed to permanent exclusion from federal health care programs, while its owner agreed to a five-year exclusion.

Norridge Gardens and Rex Therapeutics Were a Separate Resolution

Norridge Gardens and Rex Therapeutics later reached a smaller, separate $360,000 resolution announced on August 16, 2021. Quality Therapy had been an earlier therapy supplier in that case. A former employee of Quality Therapy and Rex Therapeutics brought the two civil lawsuits, and the government joined both.

The government alleged that, from 2008 through 2016, the facility pressed therapists to meet quotas, billed without physician orders and claimed services when residents did not participate or could not benefit. The arrangement moved from an outside supplier to an affiliated therapy company. It shows why the facility’s own directions belong in the story even when another company supplies the therapists.

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

When the Therapy Target Came First

If you saw treatment plans or medical records shaped around a Medicare payment target, speak to one of our whistleblower experts about what happened inside the therapy department. We help you build your strongest skilled nursing whistleblower case around the decisions behind the claims, bring in nursing home fraud whistleblower lawyers who understand therapy billing, and stay beside you throughout the case.