Office of the Attorney General
U.S. Attorney's Office Files Suit Against Erlanger Nursing Home Following Attorney General's Investigation

Press Release Date:  Monday, July 18, 2011  
Contact Information:  Shelley Catharine Johnson
Deputy Communications Director
502-696-5659 (office)

Attorney General Jack Conway announced today that the U.S. Attorney's office has filed a civil complaint against an Erlanger nursing home following an investigation by General Conway's Office of Medicaid Fraud and Abuse Control. The U.S. Attorney's office alleges in its lawsuit that Villaspring Healthcare and Rehabilitation, its parent company Carespring Health Care Management and its owner billed Medicaid and Medicaid for services purportedly provided to its residents, despite knowing that the services were so inadequate that they were essentially worthless.

The complaint alleges that from 2004 to 2008, numerous patients suffered serious injuries resulting from the worthless care. Five of those patients died as a result of their injuries. The alleged inadequate care included failure to follow physicians' orders, failure to treat wounds and pressure sores, failure to update resident care plans, and failure to monitor the blood sugar levels of diabetic residents.

"Investigators from my office worked diligently on this case to help protect residents of this nursing home," said General Conway. "We are pleased that United States Attorney Harvey has filed this action to help achieve that goal and we are looking forward to working with his office throughout this process. We will continue to investigate abuse and neglect in Medicaid-funded facilities and take action to protect Kentucky's vulnerable citizens."

This is the first suit filed in Kentucky in which the government alleges that a nursing home defrauded Medicare and Medicaid by submitting bills for reimbursement for providing systemically poor resident care. The complaint accuses the defendants of violating the federal False Claims Act, committing common law fraud and unjust enrichment.

"Today's filing represents an important milestone in the effort to insure effective care for Medicare and Medicaid recipients in long term care facilities," said U.S. Attorney Harvey. "In appropriate cases, the False Claims Act will be an important tool to protect both the taxpayers and federal healthcare program beneficiaries."

If found liable, the defendants would face financial penalties between $5,500 and $11,000 per false claim. The defendants would also have to repay Medicare and Medicaid three times the amount of the government's loss for the fraud.