Following an FBI corruption probe, Brius Management Co. agreed this week to pay up to $6.9 million to resolve allegations that it defrauded government healthcare programs when its employees paid illegal kickbacks to a San Diego hospital in exchange for referring patients to four of its nursing homes.
The settlement, announced Thursday by Acting United States Attorney Sandra R. Brown, stems from a “whistleblower” lawsuit alleging that four Brius nursing homes submitted fraudulent bills to the Medicare and Medicaid programs for services provided to patients referred to the facilities through the illegal kickbacks. A copy of a press release issued by the US Attorney’s Office is below.
Brius admitted that its employees at the four San Diego nursing homes used corporate credit cards to pay for gift cards, massages, tickets to sporting events, and a Hornblower cruise given to discharge planners at Scripps Mercy Hospital San Diego in order to induce patient referrals, according to federal law enforcement agencies.
“Kickbacks for patient referrals are illegal under federal law because of the corrupting influence on our nation’s healthcare system,” Brown said. “This settlement demonstrates our resolve to combat fraud that compromises the care provided to patients served by a government healthcare plan.”
As part of the settlement, the four Brius nursing homes have entered into “Corporate Integrity Agreements,” an enforcement tool used by the federal government.
It’s unclear whether the kickback scheme was carried out at only the four San Diego facilities, or whether it’s a broader practice at Brius facilities.
Brius is the largest skilled nursing provider in California accounting for about 1-in-14 nursing home beds. The settlement is the largest known disciplinary action taken against Brius, whose owner Shlomo Rechnitz was labeled “a serial violator” in court papers filed in 2014 by former California State Attorney General Kamala Harris.
The company is not stranger to state and federal investigations, including two FBI raids in recent years.
The four San Diego area nursing homes covered by the settlement are: Amaya Springs Health Care Center in Spring Valley, Brighton Place – San Diego, Brighton Place – Spring Valley, and Point Loma Convalescent Hospital.