Rehab Giant Pays $48M To End Sham Diagnosis FCA Suits

Law360 (June 28, 2019, 7:56 PM EDT) -- Rehabilitation hospital giant Encompass Health Corp. will pony up $48 million to end three False Claims Act cases accusing the company of bilking Medicare by admitting patients unnecessarily and fabricating their diagnoses, the U.S. Department of Justice said Friday.

The eight-figure payout resolves allegations that Encompass diagnosed patients with a muscle disease without clinical evidence, according to the DOJ, which joined the three whistleblower lawsuits this week for settlement purposes. Encompass' sham diagnoses allegedly gave it bigger Medicare payments and allowed its hospitals to be designated as "inpatient rehabilitation facilities" that Medicare reimburses more generously than regular hospitals.

"This important civil...

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