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Florida mental health service provider settles health care fraud case

A Florida-based mental health services provider recently reached a settlement with federal prosecutors after a former employee submitted hundreds of thousands of dollars in fraudulent health care claims.

Florida-based Paradigm Health Services provides mental health evaluations and psychotherapy services to residents in nursing homes in Tennessee. For a three-year span from 2003 to 2006, a clinical social worker employed by Paradigm forged invoices to the state Medicaid and federal Medicare programs for "services" provided to a number of nursing home residents in Tennessee. The fraudulent billing practices charged the state and federal programs for patient therapy services that were never provided.

In 2009, the clinical social worker was charged with health care fraud. She pleaded guilty and was sentenced to three years of probation and almost $86,000 in restitution.

There was no evidence that Florida-based Paradigm Health knew of their employee's fraud, but the mental health service company still agreed to a $220, 000 settlement stemming from the fraudulent practices. It is important for health care providers to properly monitor employees and make sure there are safeguards in place to prevent Medicaid and health care fraud from occurring.

As part of the settlement, Paradigm has agreed to enter in a corporate integrity agreement with the U.S. Department of Health and Human Services Office of Inspector General. Under the integrity agreement, the company will have to implement procedures aimed at minimizing fraud and abuse.

Source: Press Release, "TennCare Fraud Settlement Announced," Department of Justice, 13 July 2011.

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