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Visiting Nurse Group to Pay $57 Million in Whistleblower Lawsuit

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The Visiting Nurse Service of New York has agreed to pay $57 million to settle a federal whistleblower lawsuit regarding allegations of patient endangerment and fraud. The organization is one of the largest non-profit home health care agencies in the country.

The lawsuit alleges Visiting Nurse Service of New York created false timesheets for services that were not provided or only partially provided and collected Medicaid and Medicare reimbursements from the state and the federal governments. According to the federal and New York State False Claims Acts these actions are illegal.

The organization agreed to the settlement but accepted no liability for wrongdoing. The company’s attorney and chief risk officers stated the lawsuit was based on untrue allegations, but Visiting Nurse Service (VNS) wanted to put the distraction behind them and move forward after more than five years of defending itself against the lawsuit.

According to whistleblower Edward Lacey and his legal team, this case sheds light on common practices in the home healthcare system. They called it a “pervasive practice,” and said what VNS is accused of doing is actually quite common among home healthcare providers. The lawsuit alleged VNS had wrongfully applied for and accepted millions of dollars in state and federal funding since the early 2000s.

The lawsuit alleged that VNS accepted patients into the program it knew its staff couldn’t handle so it could bill Medicare and Medicaid as much as possible. VNS patients were elderly, disabled, or immobile, and according to the lawsuit, many didn’t speak English. According to lawyers representing Lacy, many patients were not in mental or physical condition to advocate for themselves, making it easier for them to be taken advantage of and to be pawns in efforts to cheat the system.

According to Lacey, he made multiple attempts to resolve the problems internally before speaking to an attorney. As is common in whistleblower lawsuits, Lacey will receive 25 to 30 percent of what is recovered from VNS. The rest will be split between the federal and state government.

Whistleblower Lawsuits Benefit Plaintiffs and Taxpayers

For decades, Congress has relied on whistleblower reward laws to incentivize and protect people who risk their careers to disclose wrongdoing in the workplace. Employees are often privy to information not available to the general public and very few instances of fraud are committed without at least some awareness of employees.

Studies have shown that monetary awards encourage whistleblowers to come forward and alleviates the burden they take on when sharing the information they have with authorities. In many cases, despite protections in place, whistleblowers face retaliation, up to and including termination. Many are not terminated but are forced to leave their jobs because the workplace becomes so unpleasant after they speak out. Whistleblower lawsuit protection protects them from negative consequences.

Taxpayers also benefit from increased whistleblower efforts. Often, wrongdoing wastes taxpayer money. Lawsuits recover this money and open the door for improved measures in the future.

Home Health Care Providers Deal with Difficulties in Record Keeping, Says Trade Organization President

The National Association for Home Care & Hospice, one of the trade organizations that represents healthcare providers like VNS said a ruling against the company could have disrupted services for patients.

In a statement filed on behalf of VNS, the organization’s President Bill Dombi wrote “Home healthcare caregivers often face circumstances beyond their control when implementing the physician’s plan of care — such as lack of internet access or patient’s refusal to receive care on a given day — which impacts record keeping. Contrary to Mr. Lacey’s claims, Medicare has never required strict adherence to a plan of care, and we believe that VNSNY’s procedures are consistent with industry and regulatory standards.”

This was the first lawsuit to address issues with patients’ plans of care and the first to call into question situations in which home health care agencies benefit when they ignore directions.

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