HCRS to pay $170,000 settlement for violating False Claims Act

MONTPELIER, Vt. – On Tuesday, June 29, 2021, the Attorney General’s Medicaid Fraud and Residential Abuse Unit announced a settlement with Health Care & Rehabilitation Services of Southeastern Vermont of Springfield resolving allegations that HCRS violated the Vermont False Claims Act.

The settlement, reached in collaboration with the Office of the United States Attorney for the District of Vermont, resolves claims that HCRS improperly submitted Medicaid claims for services provided by an employee who was on the Office of the Inspector General, U.S. Department of Health and Human Services exclusion list and barred from receiving payments from federally funded healthcare programs.

For a period of nearly 10 years, HCRS employed an individual identified on OIG-HHS’ exclusion list and submitted claims on the employee’s behalf for reimbursement to Medicaid, in violation of the Vermont False Claims Act. In addition, the United States Attorney’s Office for the District of Vermont has concluded that HCRS violated the federal False Claims Act.

HCRS CEO, George Karabakakis, Ph.D., said, “We immediately took steps to notify the authorities as soon as we became aware of the employment issue with this staff member. We have been up front about our agency’s oversight of this personnel matter, and we took responsibility for the federal and state payments we’d received erroneously, returning all of the related revenue along with a substantial penalty. As a community mental health agency, we regret our error and recognize the importance of ensuring all employment guidelines are followed; we have since strengthened our procedures to prevent a reoccurrence.”

HCRS has agreed to pay to the state of Vermont and the United States a total of $170,037.76, of which Vermont Medicaid will receive $101,254.61 in program restitution. The settlement amount reflects a cooperation credit in light of HCRS’s self-disclosure of the violation, assistance with the investigation, and voluntary adoption of remedial measures to guard against improper employment and claim submission in the future.

“We thank HCRS for bringing this to the state’s attention and for their cooperation,” said Attorney General Donovan. “HCRS provides important care and services to some of the state’s most vulnerable Vermonters. Performing required background checks and complying with state and federal law is vital.”

Back To Top