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Tennessee False Claims Act Settlement

As a Tennessee False Claims Act lawyer, I am very pleased to report that CRC Health has agreed to pay $9.25 million ($9,250,000.00) to settle claims brought against it under the necessary provisions of the Tennessee Medicaid False Claims Act. A former employee of the group, a subsidiary of Bain Capital, had accused one of its addiction treatment facilities in Tennessee of defrauding the Medicaid money by making false claims for reimbursement and offering substandard services to inmates. Angela Cederoth, the whistleblower, is set to receive compensation amounting to $1.25 million for his role in helping the recovery of misappropriated TennCare funds.

According to the whistleblower, New Life Lodge Facility, a substance abuse treatment and rehab center run by CRC Health in Burns, misappropriated millions of dollars between 2006 and 2012 by not providing assured minimum standard of substance abuse therapy. The hospital did not engage well-trained and licensed therapists to treat addiction patients at the hospital to ensure maximum profit. Most of the employees tasked with taking care of inmates were not qualified as per the Tennessee law.

The principle of “medical necessity” was violated with failure to have

“New Life Lodge accepted millions of dollars of TennCare funds with the understanding that it would provide necessary substance abuse treatment services to some of the State’s most vulnerable citizens, but far too often those operating the facility failed to meet their obligations by falling short of minimum necessary standards of care or using third-party pharmacies to double-bill the program,” alleges the TN Medicaid false claim lawsuit filed in against CRC Health.

The facility was accused of engaging in double-billing to get higher payments from TennCare. It allowed admission of more patients than its stated capacity to ensure more profit, but failed to have the appropriate staff to patient ratio. Third-party pharmacies were roped in to make double billing for substance abuse medications and false bills were submitted for services not provided. Many of the services billed for were never documented.

Of the $9.25 million settlement, the State of Tennessee is set to receive $3.4 million while the qui tam plaintiff is awarded a whopping $1.25 million for help in recovering state funds. The rest of the amount is to be deposited with the federal government.

Tennessee Medicaid False Claims Act

The Tennessee Medicaid False Claims Act enacted in 1993 allows necessary civil action by qui tam plaintiffs to highlight defrauding of TennCare funds and recover the conned money along with penalty. A TennCare fraud whistleblower can proceed with the state prosecution on his own with a qualified TN false claim attorney seeking return of the defrauded Medicaid funds on behalf of the state. He is assured of legal protection and financial award for his role in retrieving the public money.

AIM Healthcare Services agreed to settle a litigation filed invoking the Tennessee Medicaid False Claims Act in February 2014. Accused of pocketing TennCare funds by making false bills, the group paid close to $800,000, of which the whistleblower received over $100,000 as reward.

According to report, qui tam relators had helped state and federal governments to recover over $3 billion duped by false billing, upcoding, and other fraudulent practices in 2013. Of the 846 lawsuits filed last year, whistleblowers and their false claim attorneys played a vital role in 89 percent of litigations leading to retrieval of embezzled public money.

To Contact a Tennessee False Claims Act Lawyer

We help whistleblowers on a contingency basis, meaning there is no fee charged for our work unless there is a recovery. We also front any and all expenses. No matter where you are located — we will represent you. We will come to you, you will not have to come to us. Attorneys in our firm and attorneys that we work with on Whistleblower, Qui Tam, False Claims Act cases have represented a host of persons making claims, for violations of federal tax law, Medicare law and more. For more information, please contact our team of whitsleblower and qui tam attorneys today.

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Our offices will review potential false claims act cases in all fifty states, including Tennessee, Arkansas, Mississippi, Kentucky and Alabama.