Taylor Swift Kickbacks Contribute to $16 Million Home Health Judgment

The latest home health agency fraud settlement is so huge, even Taylor Swift is involved—at least tangentially.

A home health agency that used Taylor Swift concert tickets as kickbacks now owes the federal government $16 million, under the terms of a judgment announced Oct. 1.

Lexington, Kentucky-based Nurses’ Registry and Home Health Corp., along with the estate of its former owner, the late Lennie House, have agreed to the settlement. The action resolves the matter in the goverment’s favor, and under its terms, Nurses’ Registry will be sold within 90 days to an independent third party. Of the net sale proceeds, 70% will go to the federal government. Additionally, the Estate of Lennie House will be granted one year to sell off all of its assets and give 75% of the net sale proceeds to the government.

“This settlement returns ill-gotten gains to the Medicare Trust Fund and ensures that Nurses’ Registry will have no further opportunity to defraud federal health care programs,” U.S. Attorney Kerry B. Harvey said in a prepared statement published by the U.S. Attorney’s Office in the Eastern District of Kentucky.

The civil judgment marks the end of an investigation and False Claims Act litigation asserting that Nurses’ Registry fraudulently billed Medicare for medically unnecessary home health services, in addition to services involving kickbacks provided by House and the company to local doctors who referred patients to Nurses’ Registry.

Under the direction of House — who died in February at age 72, according to the Lexington Herald-Leader — Nurses’ Registry took part in systematic false billing that permitted them to wrongfully obtain millions of dollars from the Medicare program from 2004 to 2011, the federal authorities and whistleblowers alleged.

Other charges included that the home health agency falsified medical records to make it seem as if patients were homebound, or appear as though the patients had a medical need for skilled nursing or therapy services.

Specifically, Nurses’ Registry employees forged doctors’ signatures on medical records to wrongly “certify” that the patient required the company’s services. The company, at the instruction of House, often re-certified patients for more and more home health services long after the patient stopped meeting Medicare’s eligibility requirements, according to the DOJ.

Nurses’ Registry and House also gave tickets to concerts and athletic events to referral sources in order to reward or encourage patient referrals. The practice was so prevalent that doctors would contact the company to request tickets to popular events, such as the Kentucky Derby or Taylor Swift concerts, according to the U.S. Attorney’s Office in the Eastern District of Kentucky.

House also told the company’s marketing employees to deliver bottles of liquor and other enticements to referral sources in order to guarantee more valuable patient referrals that could be billed to Medicare.

House’s widow, Vicki House, said she expects a sale of the company to “a strong corporate partner which will carry on Nurses’ Registry’s 30-year reputation for compassionate care to it patients,” the Lexington Herald-Leader reported. The sale could happen as soon as next week, according to J. Guthrie True, the attorney representing Nurses’ Registry in the federal litigation.

In September 2011, the United States filed a complaint against Nurses’ Registry, Lennie House and Vicki House after an investigation into a whistleblower lawsuit filed by former employees David Price and Alisia Robinson-Hill. Following several years of litigation, this settlement, in conjunction with a previous settlement with Vicki House for $1,082,416, fully resolves that action in favor of the government.

Under federal law, the whistleblowers, Price and Robinson-Hill, are set to get 15% to 20% of the settlement proceeds, the Herald-Leader reported.

Nurses’ Registry and Home Health had filed for Chapter 11 bankruptcy protection in June.

Written by Mary Kate Nelson