A Miami nursing home executive has filed a wrongful discharge suit against Integrated Health Services, alleging that the company fired him after he discovered it had falsely billed Medicare for services and violated federal securities laws.
The lawsuit was filed by Tony Gilchrist, a former executive director of Integrated Health Services at Greenbriar, a nursing home in Miami. Mr. Gilchrist, who is seeking damages in excess of $15,000, filed the complaint last August in state court in Miami.
Named in the lawsuit were Robert Elkins, IHS' chairman and chief executive officer; Eric Reiseberg, IHS' vice president of operations; Butch Shelton, IHS' regional vice president; and Danette Cottle, chief financial officer of IHS at Greenbriar.
IHS officials vehemently denied the lawsuit's charges, stating they investigated Mr. Gilchrist's allegations prior to his leaving the company and found them baseless. Officials further emphasized that Mr. Gilchrist resigned from his position and wasn't fired, as asserted in his complaint.
News of the lawsuit comes amid published reports that IHS is considering a hostile takeover of Fort Smith, Ark.-based Beverly Enterprises, the nation's largest nursing home chain. At deadline, IHS hadn't commented on the takeover reports.
In addition, the Owings Mills, Md.-based long-term-care chain last week was awarded the 1994 C. Everett Koop Award, which recognizes individual corporations for excellence in reducing medical costs while improving healthcare services.
In the complaint, Mr. Gilchrist alleges he was fired from the nursing home after he uncovered a series of questionable accounting and billing practices taking place at the facility as well as at other IHS-owned nursing homes.
The complaint alleges that the company violated state and federal securities laws by altering records to defer significant expenses and inflate costs in some departments, and by adjusting bed designations to raise Medicare payments.
It further alleges that IHS violated Medicare laws by acquiring companies that previously provided ancillary services to IHS-owned nursing homes, and then contracting with those companies at a higher rate of service to receive increased Medicare reimbursements.
"Upon information and belief, similar patterns of behavior were also being engaged in at other IHS facilities throughout the United States," the complaint alleged.
Under the Federal False Claims Act, Mr. Gilchrist could seek legal status as a "whistleblower" against a business that has defrauded the government. If the government joins the case, Mr. Gilchrist could obtain up to 25% of any monetary awards recovered in the complaint.
Mr. Gilchrist declined to comment on the suit or his legal plans. However, his Miami-based attorney, Joseph Caruncho, said his client hasn't determined whether he will file a whistleblower's lawsuit in federal court.
The lawsuit claims IHS officials fired Mr. Gilchrist on the grounds that he lost credibility with his employees after he was jailed for failing to pay spousal support.