Jerome F. Gorgon, Jr., U.S. Attorney’s Office for the Eastern District of Michigan | Department of Justice
Team Rehabilitation Services, LLC has agreed to pay $4,969,494 to resolve allegations that it submitted false claims for physical therapy services to several federal healthcare programs, according to a Mar. 25 announcement by United States Attorney Jerome F. Gorgon Jr.
The case is significant because it addresses concerns about fraudulent billing practices that can undermine public trust and waste government resources intended for patient care.
The settlement covers alleged improper billing by Team Rehab from January 1, 2018 through December 31, 2024. During this period, the company is accused of charging federal healthcare programs such as Medicare, Medicaid, TRICARE, the Federal Employees Health Benefits Program (FEHBP), and the Department of Veterans Affairs for time-based Current Procedural Terminology (CPT) codes meant for one-to-one physical therapy services when those services were actually provided in group settings without sufficient direct patient contact.
"Improperly billing federal healthcare programs depletes valuable resources and erodes public trust," said U.S. Attorney Gorgon. "This case is further proof that this office will continue to aggressively root out fraud, waste, and abuse in our healthcare system."
Dr. David Krulak of the Defense Health Agency said: "Protecting the integrity of the TRICARE program and ensuring responsible stewardship of taxpayer dollars are top priorities for the Defense Health Agency. This settlement sends a clear message that we will not tolerate practices that exploit the program and inflate costs at the expense of our service members, veterans, and their families." Derek M. Holt from the U.S. Office of Personnel Management Office of Inspector General added: "Taxpayers pay the price when medical services under federal health care programs are improperly billed... We are grateful to our colleagues at the Department of Justice for continuing to pursue accountability for these actions and protecting the integrity of programs like FEHBP."
After learning about the investigation by authorities including multiple inspector general offices and state agencies in Michigan, Team Rehab cooperated with officials by identifying improper claims itself and putting additional compliance measures in place.
The civil settlement resolves a lawsuit originally filed under whistleblower provisions; as part of this process known as qui tam litigation (United States ex rel. Thornton v. Team Rehabilitation Physical Therapy), a private party who reported wrongdoing will receive $919,356 from the total recovery.
