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Life Care Will Pay $145M To Settle Medicare Lawsuit

Leon County Judge John Cooper on June 30, 2022, in a screen grab from The Florida Channel.
Flickr Creative Commons
The Florida Channel
Leon County Judge John Cooper on June 30, 2022, in a screen grab from The Florida Channel.

The U.S. Department of Justice has settled a lawsuit with the nation’s largest private nursing home company.


Life Care Centers of America will pay $145 million to settle allegations. It will pay a $45 million down payment, and the rest over three years.


Life Care Centers of America has more than 60 nursing homes in Florida, from Jacksonville to Orlando to Fort Myers. The Justice Department alleges the company put patients into the highest levels of therapy so it could bill Medicare at the highest rates.


As part of the settlement, the company has agreed to five years of government monitoring of its therapy services. This is the government’s largest-ever settlement with a nursing home.


“Billing federal healthcare programs for medically unnecessary rehabilitation services not only undermines the viability of those programs, it exploits our most vulnerable citizens,” U.S. Attorney Nancy Stallard Harr for the Eastern District of Tennessee said in a statement. “We are committed to working with our federal partners to protect both.”


The Justice Department also separately sued the company’s owner Forrest Preston, saying he was “unjustly enriched” by the scheme. Preston denies any wrongdoing.


“We deny in the strongest possible terms that Life Care engaged in any illegal or improper conduct,” Preston wrote in a statement. “We are, however, pleased to finally put this matter behind us, without any admission of wrongdoing, and we look forward to continuing our efforts to deliver quality care and services to our patients, residents, and their families.”

Health News Florida reporter Abe Aboraya works for WMFE in Orlando. He started writing for newspapers in high school. After graduating from the University of Central Florida in 2007, he spent a year traveling and working as a freelance reporter for the Seattle Times and the Seattle Weekly, and working for local news websites in the San Francisco Bay area. Most recently Abe worked as a reporter for the Orlando Business Journal. He comes from a family of health care workers.