Encore Rehabilitation Services LLC, Medicare Fraud, Michigan 2023

Encore Rehabilitation Services LLC, a Farmington Hills, Michigan-based company, has agreed to pay $4.03 million to resolve allegations that it knowingly caused three Michigan skilled nursing facilities to submit false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary or skilled, according to a recent investigation by the Grimy Times.

The allegations stem from Encore’s policies and practices at three Michigan skilled nursing facilities, including the Autumn Woods Healthcare Facility in Warren, Michigan, the Bay Shores Senior Care and Rehab Center in Bay City, Michigan, and MediLodge of Yale in Yale, Michigan. The alleged misconduct occurred from September 1, 2012, to July 31, 2018, April 1, 2013, to April 6, 2017, and October 1, 2010, to April 6, 2017, respectively.

According to the investigation, Encore’s practices resulted in the provision of unreasonable, unnecessary or unskilled rehabilitation therapy or the recording of therapy minutes as individual therapy when concurrent or group therapy was actually provided. The submission of claims for unreasonable, unnecessary or unskilled rehabilitative services is improper and unacceptable, according to officials.

“Billing federal healthcare programs for medically unnecessary rehabilitation services not only undermines the viability of those programs, it exploits our most vulnerable citizens,” said U.S. Attorney Matthew Schneider for the Eastern District of Michigan. “We are committed to working with our federal partners to protect both vulnerable Michiganders and these helpful healthcare programs.”

Contemporaneously with the civil settlement, Encore entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Health and Human Services – Office of Inspector General (HHS-OIG) requiring, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks. The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.

The settlement resolves allegations originally brought in lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act by Linda Anderson, Reza Saffarian and Audrey Theile, and Adam LaFerriere, former Encore employees. The False Claims Act permits private parties to file suit on behalf of the United States and to share in any recovery.

“The resolution announced today demonstrates my office’s commitment to aggressively pursuing providers who utilize fraudulent practices to knowingly put their own financial self-interest over a duty to patients,” said U.S. Attorney Andrew Byerly Birge for the Western District of Michigan. “It is imperative that providers make healthcare decisions based upon a patient’s need for services rather than a self-serving desire to maximize financial profits.”

Related Federal Cases