Former owner, operator of home health care company in Florida settles whistleblower’s allegations for $1.75 million

by bvernia | March 24th, 2016

On March 2, the Department of Justice announced that Mark Conklin, the former owner/operator of two home health care companies, had agreed to pay $1.75 million to settle civil allegations, originally bought by a whistleblower, that the companies paid kickbacks to physicians for referrals.

Mark T. Conklin, the former owner, operator and sole shareholder of Recovery Home Care Inc. and Recovery Home Care Services Inc. (collectively RHC) has agreed to pay $1.75 million to resolve a lawsuit alleging that he violated the False Claims Act by causing RHC to pay illegal kickbacks to doctors who agreed to refer Medicare patients to RHC for home health care services, the Department of Justice announced today.  Conklin sold the RHC companies to National Home Care Holdings LLC, on Oct. 9, 2012.

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From 2009 through 2012, Conklin spearheaded a scheme whereby RHC, headquartered in West Palm Beach, Florida, allegedly paid dozens of physicians thousands of dollars per month to serve as sham medical directors who supposedly conducted quality reviews of RHC patient charts.  According to the government’s lawsuit, the physicians in many instances performed little or no work, but nevertheless received thousands of dollars from RHC.  The government’s complaint contended that these payments were, in fact, kickbacks intended to induce the physicians to refer their patients to RHC, in violation of the Anti-Kickback Statute and the Stark Law.

These laws are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives.  The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by federal health care programs, including Medicare.  The Stark Law forbids a home health care provider from billing Medicare for certain services referred by physicians who have a financial relationship with the entity.   A person who knowingly submits, or causes the submission, to Medicare of claims that violate either the Anti-Kickback Statute or the Stark Law is also liable for treble damages and penalties under the False Claims Act.

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The United States previously reached a settlement with RHC’s purchaser, National Home Care Holdings, on March 9, 2015, for $1.1 million.

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The Government has not yet announced the relator’s share of the settlement proceeds.

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