Feds Investigating One Of The Nation’s Largest Assisted Living Companies

From the 2013 Frontline story on Emeritus and the assisted living industry. You can watch the whole thing here.

Last summer, a ProPublica/Frontline report put a spotlight on Emeritus Senior Living, one of the country’s largest private operators of assisted living facilities (and soon to be the largest, if a proposed merger goes through), raising questions about the company’s business practices and the general lack of regulation in the industry. Now comes news that Emeritus is under investigation by the federal government.

According to ProPublica’s A.C. Thompson, Emeritus has been the subject of a joint investigation by the Justice Department and the inspector general for the Department of Health and Human Services for more than a year. Investigators are reportedly looking into allegations of improper Medicaid billing and other issues.

Sources tell Thompson that company lawyers have instructed employees to “not feel compelled to provide answers, documents, or information to any government investigator or agent,” telling them they “may politely decline to answer,” or refer agents to the Emeritus legal department.

That said, the e-mail to employees did ask them to be truthful with any answers they did provide to investigators.

A rep for the company confirmed the existence of the investigation but deemed it a routine civil probe and said Emeritus has been cooperating fully.

Emeritus has previously paid $1.86 million to settle allegations of Medicaid billing fraud in Texas, where authorities claimed the company “routinely submitted false claims to the Texas Medicaid program” for 11 facilities in the state. Emeritus did not admit to any wrongdoing in the settlement.

Medicaid/Medicare also only accounts for about 14% of total revenue for Emeritus, though that still adds up to more than $250 million a year.

Consumer advocates tell ProPublica that, as in the Texas case, it is usually state authorities that investigate Medicaid billing concerns, which raises the question of why federal investigators are involved.

Only last week, Emeritus announced a proposed $2.8 billion merger with Tennessee-based Brookdale Senior Living. If the merger is approved, the combined company would operate some 1,100 facilities in the U.S., housing more than 100,000 seniors. The merged business would also take the Brookdale name, which did not receive the high-profile spanking given to Emeritus in the wake of the Frontline episode.