Navigation Links
Two Atlanta-Based Nursing Home Chains and Their Principals Pay $14 Million to Settle False Claims Act Case

WASHINGTON, Feb. 26 /PRNewswire-USNewswire/ -- Atlanta-based Mariner Health Care Inc. and SavaSeniorCare Administrative Services LLC, as well as their principals, Leonard Grunstein, Murray Forman and Rubin Schron, have agreed to pay the United States and several states $14 million, the Justice Department announced today. This settlement arises from allegations of the United States that the defendants solicited kickback payments from Omnicare, the nation's largest pharmacy that specializes in dispensing drugs to nursing home patients, in exchange for agreements by Mariner and Sava to continue using Omnicare's pharmacy services for 15 years.

In a complaint filed in March 2009 and unsealed in November 2009, the United States alleged that Omnicare, Mariner, Sava, Grunstein, Forman and Schron conspired to arrange for Omnicare to pay Mariner and Sava $50 million in exchange for the right to continue providing pharmacy services to the nursing homes, which together constituted one of Omnicare's largest customers. The parties allegedly attempted to disguise the $50 million kickback as a payment to acquire a small Mariner business unit that had only two employees and was worth far less than $50 million. According to the complaint, Omnicare paid $40 million of this amount prior to actually acquiring the Mariner business unit and, at the same time, Omnicare obtained new 15-year pharmacy contracts from Mariner and from Sava, a new nursing home chain that Grunstein and Forman created from the Mariner chain. The complaint alleged that Grunstein and Forman illegally tied the new pharmacy contracts to Omnicare's agreement to purchase the small Mariner business unit, and that the total $50 million purchase price for the business unit actually was a kickback by Omnicare to keep the future business of Mariner and Sava.

Approximately $7.84 million of the settlement proceeds will go to the United States, while $6.16 million has been allocated to certain state Medicaid programs. In November 2009, the United States, numerous states and Omnicare entered into a $98 million settlement agreement that, among other things, resolved Omnicare's civil liability under the False Claims Act for allegedly paying a kickback to Mariner and Sava.

The government's complaint further alleged that, in 2006, after the government issued subpoenas concerning the transaction, the individual defendants created backdated documents in a further attempt to hide the kickback.

"Nursing home residents and their families are entitled to make health care decisions free from the distortions caused by illegal kickback schemes," said Tony West, Assistant Attorney General for the Justice Department's Civil Division.

"This case reflects the government's continuing efforts to pursue those who scheme to hide illegal payments that can affect the way drugs and other services are delivered to nursing home residents, an especially vulnerable patient population," said Carmen M. Ortiz, U.S. Attorney for the District of Massachusetts.

As part of the settlement, Mariner has entered into a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services (OIG-HHS). This agreement provides for Mariner to put in place procedures and reviews to avoid and promptly detect conduct similar to that which gave rise to this matter. At the same time, OIG-HHS has reserved its rights to seek exclusions of Sava, Grunstein, Forman and/or Schron from participation in Medicare, Medicaid and all other federal health care programs.

The settlement resolves a whistleblower action, United States ex rel. Resnick v. Omnicare, Inc., et al., No. 06-10149-RGS (D. Mass.), filed under the qui tam provisions of the False Claims Act.

The case was handled by the Justice Department's Civil Division, the U.S. Attorney for the District of Massachusetts, the Office of Inspector General of the Department of Health and Human Services, and the Federal Bureau of Investigation.

This settlement is part of the government's emphasis on combating health care fraud. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover approximately $2.2 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department's total recoveries in False Claims Act cases since January 2009 have topped $3 billion.

SOURCE U.S. Department of Justice

Back to top



SOURCE U.S. Department of Justice
Copyright©2010 PR Newswire.
All rights reserved

Related medicine news :

1. Croft & Bender Advises Atlanta-based Alliance Surgery, Inc. in Its Acquisition by HealthMark Partners, Inc. of Nashville
2. Nursing Home Abuse Reports and Statistics Provided by IQ Nursing Homes
3. Herzing University Online Launches Master and Bachelor of Science Degrees in Nursing
4. Website for Nursing Jobs Launches -- Streamlined Job Board Created to Address Nursing Shortage
5. MyNursingUniforms Adds Skechers Brand Name Shoes and Scrubs to Store
6. Home Health Care Newest Market Sector for Marketing/PR firm, Placemaking Group, With Addition of Client, Nursing and Rehab At Home
7. Blacks in Nursing Homes Vaccinated Less Than Whites
8. Loyola's Doctor of Nursing Practice Application Deadline Extended
9. The Meadows Health Care Center Receives the Award of Excellence from the Ohio Academy of Nursing Homes
10. Online Medical Supply Comparison Shopping Service Saves Nursing Homes Money
11. Orbis Education Secures $8.0 Million in Funding for Expanding Online Nursing Education Platform
Post Your Comments:
(Date:11/30/2015)... ... ... According to research by the National Association of Dental ... certified or obtain continuing education. To increase awareness of the lack of standards ... inform dentists that the technicians they trust could lack the skills and knowledge ...
(Date:11/30/2015)... ... November 30, 2015 , ... ... The directory is specialized and only includes chiropractic clinics in the US. , ... and trustworthy alternative health practitioner when back pain sets in. When people are ...
(Date:11/30/2015)... ... November 30, 2015 , ... ... experience this summer, ushering in a new era of publicly accessible automated technology. ... shuttle, will continue to offer guests an up-close look at the shuttle at ...
(Date:11/30/2015)... ... November 30, 2015 , ... ... for Halloween festivities, the Word of Life Christian Church of Flint, MI, hosted ... featuring a giant 1.25 ton pile of candy dubbed “Candy Mountain”. , A ...
(Date:11/30/2015)... ... November 30, 2015 , ... In an effort ... to access life-saving information provided directly from top experts in mesothelioma, in ... individual conferences in three major cities: Houston, San Francisco, and Chicago. , ...
Breaking Medicine News(10 mins):
(Date:11/30/2015)... Die MEDTEC Japan 2016, ... Entwicklung und Herstellung medizinischer Geräte, findet ... in Tokyo ... Foto: ... --> ...
(Date:11/30/2015)... , Nov. 30, 2015 Nevro Corp. (NYSE: ... providing innovative evidence-based solutions for the treatment of chronic pain, ... at the U.S. Patent and Trademark Office (USPTO) has denied ... Patent No. 8,359,102 (the ,102 patent).  ... unit of Boston Scientific Corporation filed two petitions challenging the ...
(Date:11/30/2015)... , Nov. 30, 2015   Royal ... announced the launch of Radiology Solutions, a fully ... Radiology Solutions comprises customized, data-driven practice management approaches ... to help radiology practices improve care delivery and ... 2015 Radiological Society of North America Annual Meeting ...
Breaking Medicine Technology: