Government Contractor Pays $742,500 to Settle False Claims Act Allegations in Obtaining Contracts Reserved for Eligible Small Businesses
RICHMOND, Va. – A Henrico County mental health services provider and its executive officer agreed to settle a civil lawsuit alleging they caused the submission of false claims to the Virginia Medicaid program, announced Acting U.S. Attorney Raj Parekh for the Eastern District of Virginia and Mark R. Herring, Attorney General of Virginia.
NDUTime Youth & Family Services, Inc. (NDUTime) and its current Chief Executive Officer, Teshana Gipson, of Henrico County, have agreed to pay $700,000 to settle a civil fraud lawsuit alleging they caused false claims to be submitted for payment from the Virginia Medicaid program.
The United States and the Commonwealth of Virginia jointly filed a complaint against NDUTime and Gibson under the federal False Claims Act and the Virginia Taxpayers Against Fraud Act. NDUTime provided crisis intervention, crisis stabilization, and therapeutic day treatment for children, among other mental health services. NDUTime was only entitled to reimbursement for services that it actually provided. In addition, Virginia state law required that certain services be provided by a licensed mental health professional and that initial assessments be made before services were provided. The lawsuit alleged that, between 2013 and 2017, NDUTime submitted false claims for services that it did not actually render, false claims for services that were not provided by a licensed counselor, and false claims that were based on initial assessments that were not completed by a licensed counselor.
The Government initiated an investigation after two separate lawsuits were filed under the False Claims Act and the Virginia Taxpayers Against Fraud Act by whistleblowers who made the allegations. These Acts permit the government time to investigate allegations of fraudulent conduct and to intervene in such lawsuits. Based on their investigation of the allegations, the Government intervened, the cases were consolidated and unsealed, and the Government filed its own complaint.
The False Claims Act and the Virginia Taxpayers Against Fraud Act also permit whistleblowers to receive a share of between fifteen and twenty-five percent of any recovery.
The resolution in this matter was the result of a coordinated effort by the U.S. Attorney’s Office for the Eastern District of Virginia and the Virginia Office of the Attorney General’s Medicaid Fraud Control Unit. The matter was investigated by Assistant U.S. Attorney Robert McIntosh, former Assistant Attorney General Jessica McKenzie, and Assistant Attorneys General Airen Adamonis, Ray Bowman, and Megan Winfield.
Related court documents and information from the civil lawsuit are on PACER by searching for Case No. 3:16-cv-653.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
The civil claims settled by this agreement are allegations only; there has been no determination of civil liability.