Watch CBS News

LA Company Managing 27 SoCal Nursing Facilities To Pay $16.7 Million To Settle Medicare Fraud Case

LOS ANGELES (CBSLA) — A Los Angeles company operating 27 skilled nursing facilities has agreed to pay $16.7 million to resolve allegations of Medicare fraud.

Longwood Management Corporation – which operates facilities in areas like Burbank, Los Angeles, Long Beach, Covina, Rosemead, Fontana, San Gabriel, Norwalk, Anaheim, and Pico Rivera – had been accused of violating the False Claims Act by submitting claims to Medicare that were not reasonable or necessary, according to the U.S. Department of Justice.

"Longwood's business plan called for substantial revenue from Medicare, and it pressured therapists to provide additional unnecessary services when targets were not met," United States Attorney Nick Hanna said in a statement.

The $16.7 million settlement covers claims submitted from May 2008 through August 2012 at six facilities: Alameda Care Center in Burbank, Burbank Rehabilitation Center, Magnolia Gardens Convalescent Hospital in Granada Hills, Montrose Healthcare Center, Sherman Oaks Health & Rehab Center, and West Hills Health & Rehab Center. Conduct between January 2006 and October 2014 at 21 more facilities is also covered by the settlement.

The settlement also required Longwood to enter into a five-year Corporate Integrity Agreement with the Department of Health and Human Services office of Inspector General that will require an annual independent review to assess the medical necessity and appropriateness of therapy services billed to Medicare.

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.