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Analysis

Vanguard SNFs to Pay $18M to Resolve False Claims Act Allegations

By John Commins  
   February 28, 2019

Prosecutors allege that Vanguard SNFs and top executives submitted false claims to Medicare and Medicaid for "worthless" services.

Vanguard Healthcare LLC and two top executives will pay more than $18 million to resolve allegations that five of the company's skilled nursing facilities billed Medicare and Medicaid "for grossly substandard nursing home services," the Department of Justice said.

The settlement also resolves claims brought by DOJ against Vanguard's majority owner and CEO, William Orand, and Vanguard's former director of operations, Mark Miller, who agree to pay $250,000 as part of this settlement.

"Simply stated, our elderly and vulnerable citizens who can't care for themselves deserve far better treatment than what they were subjected to by Vanguard," U.S. Attorney Don Cochran for the Middle District of Tennessee said in a media release.

"The substandard care that many of these facilities' residents endured while the companies were raiding the public coffers is deplorable," he said. "This settlement holds them accountable and the ensuing Corporate Integrity Agreement should ensure that this conduct is not repeated going forward."

DOJ and Tennessee filed suit against several Vanguard companies, Miller, and Orand, alleging that they were responsible for five Vanguard-owned skilled nursing facilities submitting false claims to Medicare and Medicaid for nursing home services that were "grossly substandard or worthless."

In particular, the state and federal prosecutors allege that the five Vanguard nursing facilities:

  • Failed to administer medications as prescribed;
     
  • Failed to provide standard infection control, resulting in urinary tract infections and wound infections;
     
  • Failed to provide wound care as ordered;
     
  • Failed to take prophylactic measures to prevent pressure ulcers, such as turning and repositioning;
     
  • Used unnecessary physical restraints on residents;
     
  • Failed to meet basic nutrition and hygiene requirements of residents.

The lawsuit further alleged that the defendants were responsible for the submission of hundreds of preadmission forms by these facilities to TennCare, Tennessee’s Medicaid Program, which contained forged nurse or physician signatures.

Vanguard and several of its companies that have reorganized in bankruptcy will pay more than $5.1 million, and two bankrupt Vanguard companies will pay $13.5 million.

Vanguard's SNFs include Boulevard Terrace Rehabilitation and Nursing Center in Murfreesboro, Tennessee; Glen Oaks Health and Rehabilitation in Shelbyville, Tennessee; and Manchester Health Care Center in Manchester, Tennessee.

Vanguard previously operated three other SNFs in Tennessee, including Crestview Health and Rehabilitation in Nashville; Imperial Gardens Health and Rehabilitation in Madison; and Poplar Point Health and Rehabilitation in Memphis.

In addition, Vanguard Healthcare owned Elderscript Services, LLC, in Tupelo, Mississippi, which provided pharmacy services to the Vanguard SNFs.

Due to the bankruptcy of Vanguard, federal prosecutors anticipate the total government recovery will exceed $6 million.   

“Simply stated, our elderly and vulnerable citizens who can't care for themselves deserve far better treatment than what they were subjected to by Vanguard. ”

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.


KEY TAKEAWAYS

Among the many findings, the SNFs: Failed to administer medications as prescribed; failed to provide standard infection control; failed to provide wound care; failed to take prophylactic measures to prevent pressure ulcers; used unnecessary physical restraints on residents; and failed to meet basic nutrition and hygiene requirements of residents.

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