A mobile diagnostics company this week reached an $8.5 million settlement with the federal government to resolve allegations that it engaged in a kickback scheme with some of its skilled nursing partners.
The Department of Justice accused Trident USA Health Services LLC of orchestrating “swapping” arrangements with SNFs, offering its X-ray and other diagnostic services below cost from June 2006 to this month; in exchange, the skilled nursing facilities would send referrals to Trident.
Because Medicare and Medicaid paid for Trident’s services, such partnerships were illegal under federal anti-kickback laws, the DOJ asserted, alleging that Trident’s management fraudulently certified that the company was in compliance with all anti-kickback provisions.
The federal government was able to secure the $8.5 million settlement cash despite the fact that Trident filed for bankruptcy protection in February.
“Companies that violate the False Claims Act through illegal swapping arrangements, or by any other illegal scheme violating federal laws designed to protect the public, will not find a safe harbor in bankruptcy court,” first assistant U.S. attorney Jennifer Arbittier Williams said in a statement announcing the settlement. “The government will not relent or be deterred in our pursuit of justice for America’s taxpayers.”
As is common in False Claims Act cases, Trident did not admit any guilt and a court did not formally find the company liable for its actions; the DOJ’s assertions remain allegations.
A spokesperson for Trident told Skilled Nursing News that the company does not comment on litigation or settlements as a matter of corporate policy and at the advice of counsel.
A pair of Trident employees — former chief information officer Ravi Srivastava and regional sales manager Peter Goldman — alerted the federal government to the scheme, and thus will receive portions of the settlement as permitted under the False Claims Act.
Srivastava’s whistleblower award totaled more than $2 million, while Goldman is set to receive $106,250.
“The whistleblowers and their lawyers provided vital and exceptionally valuable support to the government’s effort in this case, even after Trident’s bankruptcy put any recovery in doubt,” Williams said.