The People News, a free newspaper serving Cleveland Tennessee (TN) and Bradley County Tennessee (Tn).

Of Bradley County Tn.







Life Care plan started at top

Continued from page 1...

Prosecutors allege that companywide fraud began as early as 2006 and persisted until at least 2011. By 2008 Life Care was billing 68 percent of its Medicare therapies at the Ultra High level, nearly twice the national average of 35 percent, according to court documents.

"Life Care set both these targets based solely on financial considerations and not on the individualized medical needs of its Medicare beneficiaries," prosecutors allege.

Reams directed regional managers to increase therapy rates and length of stay among the 29 regions he directed across the country, prosecutors say. Those directors oversaw therapy managers at individual facilities.

At each facility a therapy team, with workers trained in physical, occupational and speech therapy, provided the care for patients.

Facilities that did not have the rates corporate headquarters wanted were labeled "focus facilities" and began receiving quarterly visits from Reams' staff, monthly visits from divisional rehabilitation directors and weekly visits from regional rehabilitation directors.

Prosecutors say the regional rehabilitation directors told therapists to assign patients to the Ultra High level of therapy "regardless of diagnosis, physical ability or current health status."

The directors set the number of therapy minutes "sometimes over the express objections and recommendations of therapists. And directors pushed therapists to approach patients seven to eight times a day to meet the number of assigned minutes."

"Life Care employees viewed the program as an artificial means of extending a patient's length of stay," according to court documents.

Those who complained on the company's hotline sometimes faced retaliation.

"Although Life Care received numerous complaints from both inside and outside the company that its corporate pressure to meet Ultra High targets was undermining the clinical judgment of its therapists at the expense of nursing home patients, Life Care largely ignored those complaints or else chastised or punished those who complained," prosecutors allege.

Prosecutors claim that of those who gave their names in hotline complaints, 57 percent were fired within three weeks of making the complaint.

Carcello said going after employees who complained ran counter to the goals of the hotline and "speaks volumes about the mindset of senior management" of a company.

"Investigations frequently focused more on rooting out the complainant than investigating or addressing the problem identified in the complaint," prosecutors allege.

Rather than the compliance department investigating complaints, "the very Life Care employees responsible" for therapy targets and pressure, including Reams, conducted the investigations.

Carcello said, if true, not allowing compliance staff to conduct investigations is "extremely poor practice." He said that and not allowing unannounced inspections were "massive red flags."

"If you're told you can't look at something, often it means that you can't look at it because there's something to hide," Carcello said.

Other division heads frustrated and interfered with compliance department investigations, impeded access to data and pressured the department to close complaint cases, prosecutors say.

There are advantages and disadvantages to running a private company, Carcello said. With a private company such as Life Care decisions can be made more quickly, often more efficiently and outside of public scrutiny, especially media attention.

But public companies provide an advantage with a system of checks and balances. The board is usually made up of outsiders, and independent audit or compliance departments that report to the board are not as easily subject to pressures from other departments, he said.

"The process is designed to mitigate that risk because the people on the boards, audit committees, independent directors have a lot to lose if there's a fraud," he said.

Employee response

Some employees left the company rather than continue to work under the corporate pressure of increased therapies with questionable medical necessity, court documents show.

In May 2007 the rehabilitation manager of the Life Care center in Estero, Fla., quit her job and filed an email detailing her reasons for leaving.

"The therapists know what the patients can tolerate," she wrote. "Anyone who looks solely on the sheets and minutes has no idea why minutes are being missed.

"A patient could be sick or dying. Let me give an example of Mrs. S who we were made to put into a [therapy] category even after therapists who treated her told me she could not tolerate that level. She expired last Friday ... in front of the building while being taken to the doctor. I wonder if we had anything to do with hastening that process along," she wrote.

The entire Estero staff signed a letter sent to Reams that supported the director:

"Recently the financial goals of Life Care appear to have overshadowed the importance of complying with Life Care's own policy," the staff wrote.

A rehabilitation contractor at the company's Yuma, Ariz., facility terminated its contract because the contractor "believed that Life Care was asking therapists to provide unnecessary rehabilitation therapy designed primarily to increase Life Care revenue rather than meet patient needs," according to court documents.

For more on this story read this month's "Editorial for the People"