Troubled Health-Care Staffing Chain
Settles With Government for $150 Million
Maxim
Healthcare Services, Inc. had been accused of submitting false bills to federal
and state health programs. An earlier ProPublica
investigation found that the company had hired several nurses despite a history
of problems.
by Charles
Ornstein and Tracy Weber
ProPublica, Sep. 12, 2011, 5:03 p.m.
One of the nation's largest health-care staffing
companies has agreed to pay $150 million to settle sweeping criminal and civil
fraud allegations of submitting false bills to federal and state health
programs.
Maxim Healthcare Services, Inc. was accused of submitting
more than $61 million in fraudulent billings to government health programs for
services that were either not provided or not eligible for reimbursement, according to a press release Monday from the U.S. Department
of Justice [1]. Eight former Maxim
employees, as well as the parent of a former Maxim patient, have pleaded guilty
to felony charges.
A different set of problems involving Maxim came up
during a ProPublica investigation into
the oversight of registered nurses [2]
in 2009. We identified several nurses who were hired by the Maryland-based
company despite having a record of problems.
While working for Maxim, registered nurse Orphia Wilson,
for example, allegedly failed to call 911 [3]
after a child stopped breathing while under her care. He died. After the
incident, Wilson lost her Florida nursing license [4] but got a job with another Maxim office in Connecticut. There, she
fell asleep, then ignored—or possibly turned off—ventilator alarms that signaled a boy in her care was not
getting enough oxygen [5], state
records show. That child died, as well.
Wilson wrote in a sworn statement to investigators later [6]: "I am very sorry about the deaths of the babys [sic] I cared for. Believe me I went through my share
of guilt."
Wilson was sentenced to jail in 2008 for reckless endangerment and hiding her Florida discipline from Connecticut.
In another instance, Maxim hired a nurse who had
previously lost his license in Minnesota for
stealing drugs and faced a pending action against his California license for similar allegations,
according to nursing board records and interviews.
The firm also hired a nurse whose license had been
previously suspended by Virginia
after she was found asleep on a sofa under a blanket when she was supposed to
be taking care of a 4-month-old child with multiple health problems. After
testing positive for drugs on the job with Maxim, she lost her nursing license.
Such oversights in hiring were common [2] in the temporary nurse staffing industry, we
found. The articles focused on how regulators across the country did little to
scrutinize troubled nurses who crossed state lines to continue working. Our
earlier stories did not identify Maxim by name. We have called Maxim for
comment Monday and will update this post with their response when we get it.
The main focus of the settlement, filed in U.S. District Court in New Jersey, does not involve Maxim's
background checks of its nursing staff, but rather the company's billing
practices. In order to conceal the fraud, the government alleged, Maxim
employees falsified time sheets and covertly submitted bills for services
delivered by unlicensed offices.
“Not only did Maxim fail to back up its billings with
proper documentation, we found that Maxim frequently billed for services it
never rendered or care it never provided,” said Tony West, assistant attorney
general in charge of the Justice Department's civil division, in a statement.
“And, we learned, to avoid detection, Maxim's former officers and employees
engaged in a variety of tactics to conceal the company's fraud.”
Maxim agreed to pay a $20 million criminal fine and abide
by terms of a deferred prosecution agreement. The company is also paying $70
million to the federal government and $60 million to 42 states to settle civil
allegations.
Among the Maxim employees who have pleaded guilty is
Gregory Munzel, who was regional account manager of
Maxim's Charleston, S.C., office from 2001 to 2005. In his plea
hearing in December 2009, Munzel acknowledged
fabricating documentation to make it appear that caregivers were properly
credentialed when, in fact, they were not. He said he did so in response to
sales pressure from his superiors to generate more revenue. He also said such
falsifications were a common practice by employees in his office.
In announcing the settlement, the government went out of
its way to praise Maxim for reforming its practices, including leadership
changes, a stronger corporate compliance program and cooperation with
prosecutors in the case.
In a statement [7],
Maxim CEO Brad Bennett said, “While we regret the circumstances that led to
these agreements, the resulting enhancements have clearly made Maxim a better
and stronger company. Most importantly, at Maxim there is now a renewed
commitment to the highest standards of conduct and consistent delivery of high
quality patient care.”
Update (9/13): Maxim spokeswoman Rebecca Kirkham responded via
email: "Since the appointment of a new management team in 2009, Maxim has
made significant investments in its infrastructure and systems -- updating and
revising more than 120 policies and procedures, including its hiring and
supervision practices. Today, Maxim conducts comprehensive pre-employment
background checks on all employees. Our robust employee screening and hiring
processes are consistent with and meet all applicable state and federal
guidelines."
More coverage: When Caregivers Harm: America's
Unwatched Nurses