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Post date: January 9 2014

A.G. Schneiderman Announces $2.5 M Settlement With Rochester Home Health Agency For Defrauding Medicaid

Providers Break Laws When They Submit False Information

Schneiderman: Taxpayer Dollars For Our Most Needy Citizens Will Be Protected

NEW YORK - Attorney General Eric T. Schneiderman today announced a settlement with L. Woerner, Inc., which does business as Home Care of Rochester (HCR), resolving an investigation into false billings, including billing Medicaid for more than 6,500 hours of services provided by uncertified home health aides and aides who falsely inflated the hours they worked. The bulk of the company’s fraudulent billing meant that Medicaid was charged for business costs unassociated with patient care, such as advertising. Under the agreement, HCR, located at 85 Metro Park in Rochester, will refund the Medicaid Program $2,503,932, plus interest.

“When providers rip off Medicaid for costs unrelated to healthcare, New York’s most vulnerable patients and taxpayers are directly harmed,” Attorney General Schneiderman said. “My Office’s Medicaid Fraud unit is designed to root out this kind of malfeasance, to make our taxpayers whole, and to ensure our neediest patients get the care they need. Once the overbilling was discovered, HCR cooperated in our probe.”

The investigation by Attorney General Schneiderman’s Medicaid Fraud Control Unit, which began after an audit by the unit of company records, revealed that, between 2002 and 2006, HCR submitted more than $2.2 million in costs for non-patient care services, services that the Medicaid program does not cover. The improper business cost included country club dues for HCR executives, advertising costs and employee salaries related to marketing activities. The company also improperly billed Medicaid for the cost of company vehicles and for interest expense on business loans that was not offset by investment income. Medicaid rules allow only reimbursement for necessary costs directly associated with patient care.

After the investigation began, HCR, which is certified by Medicaid as a Home Health Agency, disclosed that it improperly charged the program for more than 6,500 hours of work by 23 uncertified home health care aides. Until the investigation began, the company was unaware the aides were not properly trained. The company also disclosed that it had unwittingly submitted false timesheet claims from home health aides who inflated the hours they worked at an HCR client, Rochester’s The Shire at Culverton Adult Care Facility.

The matter was handled by Jay Speers, Counsel to MFCU, Catherine Wagner, Director of the Rochester MFCU Regional Office and Upstate Chief of Investigations and Timothy McFarland, Special Assistant Attorney General for the Rochester Region. Michael LaCasse, Chief Auditor for the MFCU Civil Enforcement Unit, Matthew Tandle, Senior Special Auditor Investigator for MFCU Civil Enforcement and Associate Special Auditor/Investigator Michael Warfield of the MFCU Rochester Regional Office were the audit team. All are supervised by Acting MFCU Director Amy Held and Kelly Donovan, Executive Deputy Attorney General for Criminal Justice.