McKnight’s reported on the lawsuit that accuses SavaSeniorCare, one of the nation’s largest nursing facility operators, of overbilling Medicare for unnecessary therapy services. Sava filed a motion to dismiss but a federal court has ruled the lawsuit can proceed. The lawsuit, which consolidated three separate complaints against SavaSeniorCare LLC, alleges that the company pushed employees to provide high levels of therapy to residents or face “threats of repercussions or termination,” and be “publicly shamed” into meeting budget goals. The “unattainable” goals were enforced throughout Sava’s 185 facilities between 2008 and 2012, according to the lawsuit.
In his Sept. 27 opinion, Chief District Judge Kevin Sharp denied Sava’s move to have the case dismissed, citing “sufficient factual averments” to back up the claims of the former employees who brought the complaints against the provider.
“A fair reading of the Consolidated Complaint suggests that [Sava], acting in concert, created and implemented policies in an effort to wrongfully enlarge Medicare billing,” Sharp wrote. “Given the scope of [Sava’s] request (dismissal of all claims), the brevity and wide sweep of their arguments, and their failure to acknowledge certain allegations, the Court finds it unnecessary to go any further.”
SavaSeniorCare ranks as the fifth-largest skilled nursing company in the United States, according to recent data, with 200 total facilities in 22 states. The Order states the following:
B. Sava’s Structure and Operations
Sava is “organized in a pyramidal corporate structure.” (CC ¶ 54). Defendant SavaSeniorCare, LLC “sits atop” that structure, and, through its subsidiaries, owned and managed the operations of approximately 185 SNFs in 19 states (including Tennessee) during the relevant period. (CC ¶ 20). The remaining Defendants are (or were) wholly owned subsidiaries of SavaSeniorCare, LLC: (1) SavaSeniorCare Consulting, LLC provided consulting services and operational oversight to the SNFs, and employed most of the corporate-level rehabilitation and operations employees; (2) SavaSeniorCare Administrative Services, LLC performed certain “back-office” services for Sava’s SNFs, including submitting claims to Medicare, and employed Sava’s Chief Executive Officer (“CEO”), Chief Financial Officer (“CFO”), Senior Vice President (“SVP”) of Rehabilitation Services, and high-level finance employees; and (3) SSC Submaster Holdings, LLC provided services for the SNFs and employed many of Sava’s corporate-level rehabilitation and operations employees, some of whom later went to work for SavaSeniorCare Administrative Services and SavaSeniorCare Consulting when SSC Submaster Holdings ceased to exist in 2010.
Tony Oglesby “is at the top of Sava’s corporate structure,” serving as its CEO since 2005, and acquiring a majority ownership in Sava in October 2013. (CC ¶ 54).
Sava knew the financial benefits of increasing its Ultra High billings. SNF administrators, RPMs, and therapists were systematically pressured by corporate to meet targets for such billings and extend patient stays without regard to a patient’s actual needs. Beginning in 2008, if not earlier, Sava’s finance department set top-level goals – “budgets” – for the Company, that, in turn, trickled down to rehabilitation-specific goals at the divisional, regional and facility level. Thus, each of the SNFs was given set goals that were based on meeting pre-determined RU levels and Medicare Part A daily rates. Even though DVPs of Rehabilitation Services and RDRs could change the budget for a facility in their division or region, any changes had to be “budget neutral,” meaning that if an RU goal was reduced at one facility, it had to be increased at another.
Constant pressure was placed on both regional and facility-level employees to make their ever-increasing budgets. This pressure “was top-down, nationwide, and exerted by both rehabilitation and operations corporate-level employees.”