Justice News

Acting Associate Attorney General Stuart F. Delery Delivers Remarks at Press Conference Announcing False Claims Act Resolution with Extendicare
Washington, DC
United States
Friday, October 10, 2014

Remarks as Prepared for Delivery

Good morning and thank you all for being here today.  I am pleased to be joined by Joyce Branda, the Acting Assistant Attorney General for the Civil Division, as well as Gregory Demske, the Chief Counsel to the Inspector General for the Department of Health and Human Services. 

Protecting this nation’s vulnerable populations – including our seniors – has been, and continues to be, one of this department’s highest priorities.  As more and more seniors rely on nursing homes for care, it becomes increasingly important for us to ensure that they receive the services they need.

Today, we are here to announce that Extendicare Health Services – one of the nation’s largest nursing home chains with 146 facilities in 11 states – has agreed to pay $38 million to resolve allegations that certain of its facilities billed the Medicare and Medicaid programs for nursing care services that were so grossly substandard as to be effectively worthless, while also billing Medicare for medically unreasonable and unnecessary rehabilitation therapy services.  This is the largest False Claims Act settlement the department has entered with a nursing home chain involving “failure of care” allegations. 

As part of this historic resolution, Extendicare will also enter into a five year chain-wide corporate integrity agreement with the Department of Health and Human Services.  This agreement will contain innovative staffing requirements intended to ensure that this type of misconduct will not happen again. 

This significant resolution reflects a convergence of two of the department’s highest priorities. 

First, today’s settlement reflects the department’s commitment to protecting the nation’s elderly and most vulnerable citizens from all forms of abuse, neglect, and financial exploitation.  Under this administration, the department has redoubled its efforts in the elder justice arena by funding innovative research, developing training materials for elder abuse prosecutors and legal services lawyers; and by raising public awareness.  In fact, just last month, the department launched its Elder Justice Website, a tremendous resource for prosecutors, practitioners, and most importantly, elder abuse victims and their families.   

Second, today’s settlement reflects the department’s commitment to combatting health care fraud.  Given the growing Medicare eligible population, we must make every effort to protect Medicare funds from fraud, waste, and abuse.  Since the Attorney General and the Secretary for Health and Human Services launched the Health Care Fraud Prevention and Enforcement Action Team initiative in 2009, the department has recovered over $14 billion in cases involving fraud against federal healthcare programs.   The department has aggressively pursued healthcare fraud against virtually every type of healthcare provider and supplier, including hospitals, physicians, hospice providers, and pharmaceutical and device manufacturers.  Today’s settlement with Extendicare is an example of this initiative in action.

Taken as a whole, today’s resolution represents an important achievement on both those fronts.  Our seniors rely on the Medicare and Medicaid programs to provide them with quality care, dignity and respect when they are most vulnerable.  It is, therefore, critically important that we hold accountable those healthcare providers, including nursing home operators, who put their own economic gain over the needs of their residents. 

We will pursue with equal vigor those who bill Medicare and Medicaid while failing to provide beneficiaries with the nursing care to which they are entitled and those who provide medically unnecessary services in order to maximize their Medicare billings.  Both of these schemes are forms of elder financial exploitation. Neither will be tolerated by this department.  


Finally, before I turn things over to Acting Assistant Attorney General Joyce Branda, I wanted to commend the excellent work of the Extendicare team.  Given the scope of the allegations at issue, the investigation was conducted jointly by the Department of Justice’s Civil Division, several U.S. Attorney’s Offices, agents and attorneys from the HHS Office of Inspector General, as well as attorneys and agents from the Medicaid Fraud Control Units of several states.  This settlement, and the underlying investigation, is a compelling example of how federal and state law enforcement can work effectively together and of what we can achieve when we do so.  I am pleased that we are joined here today by representatives of those offices.

With that, I’m happy to introduce Joyce Branda, the Acting Assistant Attorney General for the Civil Division, who will discuss the Extendicare settlement in more detail. 

Updated October 10, 2014