Genesis Finalizes $53.6 Million Settlement Deal with DOJ

Genesis HealthCare (NYSE: GEN) on Friday announced the execution of a $53.6 million settlement with the United States Department of Justice over a variety of improper billing allegations.

The Kennett Square, Pa.-based post-acute provider denied all of the government’s claims, which included four separate sets of allegations involving various Genesis subsidiaries. In its complaint, the DOJ said that Genesis improperly billed Medicare and Medicaid for “medically unnecessary therapy and hospice services,” falsified some claims, provided “grossly substandard and/or worthless” care, and failed to maintain proper staffing levels.

Some of the issues stemmed from incidents at facilities that Genesis later acquired, including Skilled Healthcare Group, Inc. and Sun Healthcare Group, Inc.


“Genesis operates in a heavily regulated industry, and is pleased to resolve these legacy matters acquired in the Sun Healthcare and Skilled Healthcare transactions,” the company said in the release.

Genesis had initially announced a settlement figure of $52.7 million back in August 2016, and at the time indicated that it would pay the government over the course of five years.

The nationwide provider joins a long list of other similar firms that have faced DOJ scrutiny over billing issues, with Kindred Healthcare (NYSE: KND) agreeing to shell out $125 million in January 2016 and HCR ManorCare still undergoing a lengthy DOJ probe — one of the reasons that HCP Inc., a major real estate investment trust (REIT). elected to spin off the ManorCare portfolio into a separate REIT, Quality Care Properties, Inc.


“We will continue to hold health care providers accountable if they bill for unnecessary or substandard services or treatment,” Acting Assistant Attorney General Chad Readler said in the statement. “Today’s settlement demonstrates our unwavering commitment to protect federal health care programs against unscrupulous providers.”

Just as Genesis denied any wrongdoing, the government noted in its announcement that the firm was not found liable for any billing or staffing issues.

Written by Alex Spanko

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