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Press Release

Suburban Chicago Nursing Facility To Pay $360,000 To Resolve False Claims Act Allegations

For Immediate Release
U.S. Attorney's Office, Northern District of Illinois

CHICAGO — The U.S. Attorney’s Office in Chicago today announced that a suburban Chicago nursing facility has agreed to pay $360,000 to resolve civil allegations that it violated the False Claims Act by providing unnecessary and “upcoded” physical, occupational, and speech therapy services to increase Medicare payments.

A consent judgment and settlement agreement resolve allegations that, from 2008 to 2016, skilled nursing facility NORRIDGE GARDENS, of Norridge, Ill., provided medically unnecessary services to Medicare beneficiaries, first through a third-party skilled therapy vendor, Quality Therapy & Consultation Inc., formerly of Orland Park, Ill., and then through its own skilled therapy affiliate, REX THERAPEUTICS LLC, of Skokie, Ill.  The allegations contend that Norridge Gardens pressured others to meet quotas for the proportion of Medicare Part A beneficiaries utilizing the highest-possible reimbursement level, known as the Resource Utilization Group (“RUG”) score, in an effort to increase Medicare payments.  Norridge Gardens also allegedly claimed payment for therapy services without a physician order and other times reported that skilled therapy had been provided, when, in fact, the patients were not participating in therapy or were unable to undergo or benefit from it.

The consent judgment and settlement agreement resolve claims in two civil lawsuits filed in U.S. District Court in Chicago by a former employee of Quality Therapy and Rex Therapeutics under the qui tam, or whistleblower, provisions of the False Claims Act.  The Act permits private citizens to bring lawsuits on behalf of the United States for false claims, and to share in any recovery.  The United States intervened in both lawsuits prior to entry of the consent judgment and settlement agreement.

The settlement and consent judgment with Norridge Gardens and Rex Therapeutics were entered Friday in U.S. District Court in Chicago.  The United States in 2019 reached a settlement with Quality Therapy and its owner, requiring them to pay $1.09 million to resolve alleged False Claims Act violations.

The civil resolutions were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI.  The government is represented by Assistant U.S. Attorney Sarah J. North.

The public is reminded that civil allegations are accusations only, and there was no determination of liability as part of the settlement and consent judgment.

Updated August 16, 2021

Elder Justice
False Claims Act
Health Care Fraud