Horizons Hospice LLC and its CEO John C. Rezk have agreed to pay $1.24 million to settle two whistleblower lawsuits claiming the hospice admitted patients who weren’t terminally ill but billed Medicare and Medicaid for end-of-life services, according to the U.S. Attorney’s Office.
The claims in the civil cases mirror those in related criminal cases where two former executives of the company’s Pittsburgh office pleaded guilty to the fraud and were sentenced to prison.
One of the civil lawsuits was filed in 2012 by a former nurse at the company’s Pittsburgh location who told the government about the fraud.
The other lawsuit was filed in 2013 by two certified nursing assistants who formerly worked for the hospice, said attorney Robert M. Davant, who represented the two women.
“They left in disgust” over the fraud, he said.
Rezk couldn’t be reached for comment. The attorney for the company, Stephen Stallings, said he would have to check with his client before comment. Horizons Hospice LLC, which is based out of Cambria County, changed its name to 365 Hospice LLC, according to state corporation records.
Mary Ann Stewart, 50, of Carrolltown, was the chief operations manager for the Pittsburgh location. She pleaded guilty in June 2016 to health care fraud and was sentenced to 15 months in prison.
During her plea hearing, she confirmed that she had employees admit patients who weren’t terminally ill so that Horizons could bill the government health care insurance programs.
Oliver W. Herndon, 46, of Peters pleaded guilty in November 2014 to participating in the fraud as the medical director of the Pittsburgh office.
Formerly a doctor, Herndon pleaded guilty in May 2012 to prescribing 10,800 oxycodone tablets and 3,600 oxymorphone tablets to patients who didn’t have a medical need for the powerful painkillers. After the Drug Enforcement Administration revoked Herndon’s ability to prescribe opioids, the street price for painkillers doubled in the region, prosecutors said.
He was sentenced to 11 years and 3 months in prison but his sentence was reduced to 7 years in prison after he cooperated with the government in the Horizons case, according to court records.
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