U.S. reaches $30 million deal with NAHC after allegations of False Claims Act violations

By Mark Iandolo | Sep 26, 2016

SAN FRANCISCO (Legal Newsline) - The U.S. Department of Justice has announced that North American Health Care Inc. (NAHC), along with John Sorenson, chairman of the board, and Margaret Gelvezon, senior vice president of reimbursement analysis, will pay a total of $30 million after allegations of violating the False Claims Act.


According to the DOJ, the defendants violated the act by causing the submission of false claims to government health care programs for unnecessary services. The private for-profit company provides inpatient rehabilitation services.


“Medicare patients and those insured by TRICARE are entitled to receive care necessary for their clinical needs and not the financial needs of their health providers,” said principal deputy assistant attorney general Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Health care providers will be held accountable if they bill for unnecessary services or treatment.”  


NAHC will pay $28.5 million, while Sorenson will pay $1 million and Gelvezon $500,000.


“This office is committed to safeguarding the federal health care programs and the patients who are enrolled in them,” said U.S. attorney Brian J. Stretch for the Northern District of California. “Skilled nursing facilities such as NAHC treat some of the most vulnerable patients in the health care system. These facilities, and the individuals who run them, will be held accountable when they provide treatment based on financial motivations instead of the patients’ needs.”

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