SpectraCare Health Systems, Inc., Medicaid False Claims, Alabama 2024

SpectraCare Health Systems, Inc. Agrees to Pay $1 Million to Resolve Medicaid Fraud Allegations

SpectraCare Health Systems, Inc., a 501(c)(3) nonprofit organization headquartered in Dothan, Alabama, has agreed to pay $1 million to resolve a federal lawsuit alleging the company knowingly submitted false claims to the Alabama Medicaid Agency for reimbursement of services. The company provided integrated healthcare services, including developmental disability services, intermediate care medical services, behavioral health services, and preventative programs to a range of patients.

The lawsuit, initially filed in the United States District Court for the Middle District of Alabama by a former SpectraCare employee under the qui tam, or whistleblower, provisions of the False Claims Act, alleged that the company improperly billed Medicaid for Basic Living Skills services, and failed to return overpayments to the Alabama Medicaid Agency. The allegations spanned from October 1, 2012 through December 31, 2019.

Under the terms of the settlement, SpectraCare will pay $1 million, with the United States receiving $743,193.00, and the remaining $256,807.00 going to the Alabama Medicaid Agency. The whistleblower, or relator, will receive 19% of the Government’s recovery, totaling $141,197.00.

An investigation by the Office of Inspector General for the United States Department of Health and Human Services, in conjunction with the United States Attorney’s Office, found that SpectraCare knowingly submitted claims for reimbursement without complete and correct documentation, billed in duplicate, over-billed, or otherwise improperly billed. The company also made, used, or caused to be made or used, false records or statements material to its obligation to return overpayments to Medicaid.

The settlement resolves allegations that SpectraCare knowingly, intentionally, or recklessly failed to repay Medicaid for improper claim submissions and their attendant overpayments. The claims resolved by the settlement are allegations only, and there has been no determination of liability.

The case was handled by Assistant United States Attorney Samantha R. Miller and the Civil Health Care Fraud Investigator of the United States Attorney’s Office, with assistance from Assistant Attorney General James Hartin of the Office of the General Counsel for the Alabama Medicaid Agency.

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