The company allegedly submitted fraudulent Medicaid reimbursements while violating licensing and supervision of staff regulations.
Molina Healthcare and its previously owned subsidiary, Pathways of Massachusetts, have agreed to a $4.6 million settlement for allegedly violating the False Claims Act by submitting fraudulent claims for Medicaid reimbursement.
The Long Beach, California-based managed care organization owned and operated Pathways, a group of mental health centers located in Massachusetts, between November 2015 and March 2018, during which time both companies improperly submitted claims for reimbursement to MassHealth, the state's Medicaid program.
Four former Pathways employees filed a civil action lawsuit in the U.S. District Court for the District of Massachusetts, while the attorney general's Medicaid fraud division pursued an investigation into Pathways after a referral from MassHealth.
The whistleblowers, or realtors, alleged in their suit that because Pathways' clinics lacked adequate staffing, they did not qualify as eligible mental health centers.
In their investigation, the attorney general's office "found that Pathways failed to meet the regulatory requirements for frequency and adequacy of supervision, the qualifications of its supervisors, and that Pathways billed for psychotherapy services rendered by unlicensed individuals who were not supervised by appropriately licensed professionals."
"This company routinely allowed unlicensed and unsupervised mental health professionals to provide care to patients, all while billing MassHealth for it," attorney general Maura Healey said in a statement. "MassHealth patients deserve to receive treatment from qualified individuals, and my office will continue to hold providers accountable for violating these fundamental MassHealth requirements."
Molina and Pathways agreed to pay the U.S. and the Commonwealth $4.625 million, plus interest at an annual rate of 1.25%. The realtors will be paid their share of $810,000 plus interest from the U.S. and the Commonwealth.
Pathways ceased operations in March 2018 before Molina selling the subsidiary to a private investment firm in October 2018.
Jay Asser is the contributing editor for strategy at HealthLeaders.