The U.S. Justice Department said it has intervened in three whistle-blower Medicare false-claims billing lawsuits brought against HealthEssentials Solutions, a defunct Louisville, Ky.-based home-healthcare provider, and three of its executives, including former President and Chief Executive Officer Michael Barr.
This is the second company Barr has led that has been investigated by federal authorities for Medicare fraud. The first was Vencor, another Louisville-based long-term-care provider that eventually filed for bankruptcy and was renamed Kindred Healthcare after its reorganization. In 2001, Vencor paid $26 million while real estate investment trust Ventas paid $104 million to settle Medicare and Medicaid fraud charges with the Justice Department (March 12, 2001, p. 11). Barr was a co-founder of Vencor, Ventas sister company.
R. Kent Westberry, Barrs attorney with Landrum & Shouse in Louisville, declined an interview request for this story.
A year ago, a U.S. District judge in Louisville consolidated the three lawsuits against HealthEssentials into one case. The whistle-blowers allege that HealthEssentials submitted fraudulent Medicare cost reports and illegally upcoded to obtain higher reimbursements. Barr; Norman Pfaadt, former chief financial officer; and Karen Stone, who worked in the companys billing department, were all named as defendants in the lawsuits.
The Justice Department filed a notice in late April in the U.S. District Court in Louisville that stated its intention to intervene in part of the consolidated actions for upcoding of current procedural terminology, or CPT, codes; billing for services provided in assisted-living facilities using CPT codes for services provided in a patients home; and billing for services that were not medically necessary, according to the notice.
The government declined to intervene in the part of the actions that allege identical wrongdoing involving federal healthcare programs other than Medicare; billing for services provided by nurse practitioners without prescriptive authority; and billing for nurse practitioner services that were provided by medical assistants.