Alta Vista Healthcare & Wellness Centre will pay out $3.8 million to settle government allegations that they illegally paid kickbacks to doctors who referred patients to their health care network instead of Medicare or Medicaid.
The settlement does not admit guilt.
The skilled nursing facility is one of 75 in the state owned by Shlomo Rechnitz, making him the owner of one out of every 14 nursing homes, according to the Sacramento Bee.
The Bee also names Redlands Healthcare Center, Country Villa Redlands Healthcare Center, Highland Palms Healthcare Center, Fontana’s Laurel Convalescent Hospital, Country Villa Riverside Healthcare Center, Ontario Healthcare Center, Ontario’s Healthcare Center of Bella Vista, and Chino Valley Health Care Center as his.
Alta Vista has not yet replied to our request for comment
Former Riverside Healthcare & Wellness Centre accountant Neyirys Orozco was the first to allege kickbacks when she filed a lawsuit against the center and on behalf of the government in 2015.
She will receive $581,094 from the settlement.
She named Twin Med, Rechnitz’s main holding company, Citrus Wellness Center, Riverside Healthcare & Wellness Centre and Rechnitz as defendants.
She also claimed that employees at the skilled nursing facilities placed patients on the highest levels of therapy possible, even when the patients required no therapy, and that employees submitted false statements to Medicare.
The California Department of Justice and Orozco, claimed Alta Vista and its management company, Rockport Healthcare Services, illegally awarded doctors massages, limousine rides, golf trips, expensive dinners, cash, e-readers, $4,000 monthly stipends and $1,000 gift cards if they referred their patients to Alta Vista.
Rockport is owned by Rechnitz’ accountant, Orozco claimed.
Riverside Healthcare & Wellness Centre posted a $1.4 million profit on $12 million in net patient revenue in a year, Orozco claimed.
Orozco continued to claim that the staff were instructed to make up the number of required supplies each patient used, and to continually order unnecessary supplies from Twin Med.
The Department of Justice, for both the state and the federal government, litigated the case. The United States will receive $2.8 million in restitution, and California will receive $596,000.
“When a health care company cheats and offers kickbacks to gain an unfair advantage, it jeopardizes the health and well-being of those who rely on its services. These illegal schemes also make public services and programs costlier, and ultimately waste valuable taxpayer dollars,” Attorney General Rob Bonta said, according to a press release.
The settlement comes with a five-year agreement to monitor relationships between Alta Vista and physicians.
Case information
Case No. 2:15-cv-06177
California Central District Judge James Selna presided.
David Scher, Adam Augustine and R. Scott Oswald of the Employment Law Group brought the case for Orozco.
U.S. Attorney John Lee, Deputy California Attorney General Randal Glaser and Rohith Srinivas of the Civil Fraud Section of the U.S. Department of Justice litigated after the government took over the case.
Attorneys for the defendants were never announced.
Read the complaint here.
Read the settlement here.
