Life Care Centers of America agrees to $145 million settlement

The Life Care Centers of America has agreed to pay $145 million in a settlement this past week, including a whistleblower award of $29 million. The company was accused of overbilling government operated healthcare programs for unreasonable and unnecessary therapy sessions. Life Care, which operates more than 220 skilled nursing facilities nationwide, is the country’s largest private nursing home company in the United States. Forrest L. Preston, the owner of Life Care, was accused of knowingly allowing his facilities to submit false claims to Medicare taking advantage of the most vulnerable American citizens grouping as many of them into the highest reimbursement bracket for therapy without regard to their actual needs.  Additionally, Life Care was accused of keeping patients longer than necessary by treating them with therapy long after their therapists felt rehabilitation was necessary.

This settlement has been in the works since earlier this year and will cover allegations from January 1, 2006 until February 1, 2013. As part of this landmark settlement agreement, Life Care has also agreed to be part of a five year corporate integrity program which requires independent annual reviews of its Medicare billings. This nearly eight year long lawsuit was brought by two former employees of Life Care, a nurse and an occupational therapist, as a whistle blower case. Whistleblowers can bring claims on behalf of the government under the False Claims Act and receive a portion of any monetary awards. In this case, the two former workers will receive $29 million which comes out of the total settlement amount.

If you or anyone you know has expressed concern over speaking out about illegal practices at their place of employment, please have them give Fitapelli & Schaffer, LLP a call for a free phone consultation. You will be able to speak to one of our experienced attorneys who will help you navigate your whistle blower claims. You can reach us at 212-300-0375 or visit our website at