Physical Therapy Company, Nursing Home Operator Settle Whistle-Blower Lawsuit

Photo courtesy of Wikimedia Commons
Photo courtesy of Wikimedia Commons

RehabCare Group and a nursing home operator with a Missouri affiliate have agreed to pay $30 million to settle kickback allegations brought forward in a whistle-blower lawsuit.

RehabCare Group Inc. and Rehab Care Group East Inc., which are now units of Louisville, Ky.-based Kindred HealthCare Inc.; and nursing home operator Health Systems Inc., which is based in Sikeston, Ky., and its affiliate Rehab Systems of Missouri, which is based in Dexter, Mo., were charged in a kickback scheme that concerned nursing home referral business.

RehabCare allegedly paid Rehab Systems of Missouri $400,000 to $600,000 to obtain the company’s contracts to provide therapy to patients in 60 nursing homes controlled by Rehab Systems’ majority owner, according to the U.S. Department of Justice. As part of the deal, RehabCare allegedly allowed Rehab Systems to retain part of the revenue generated by each referral.

Cambridge, Minn.-based Health Dimensions Rehabilitation Inc. was the whistle-blower in the case and will receive $700,000 as its share of the recovery.

Read more from the St. Louis Business Journal


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