ATLANTA, GA – Attorney General Chris Carr, U.S. Attorney for the Northern District of Georgia BJay Pak and partners today announced that STG Healthcare of Atlanta, Inc. (“STG Healthcare”) and  CEO Paschal “Pat” Gilley and CFO Matthew Gilley have agreed to pay $1.75 million to settle allegations involving false claims submitted to Medicare and the Georgia Medicaid program. The Medicaid portion of the settlement is approximately $607,682. 

“The hospice benefit provided by Medicaid is especially reserved for terminally ill Georgians at a critical time of transition in their care,” said Attorney General Chris Carr.  “Our office is proud to have worked alongside the U.S. Attorney’s Office for the Northern District of Georgia in this effort, and we will continue to ensure the hospice benefit is not exploited and abused by health care providers to the detriment of Georgia taxpayers.”  

STG Healthcare, doing business as Interim Healthcare of Atlanta, operated a Hospice business serving the Atlanta area.  The Medicaid Fraud Division of the Georgia Attorney General’s Office in conjunction with the U.S. Attorney’s Office for the Northern District of Georgia investigated allegations that STG Healthcare falsely billed the Georgia Medicaid program for hundreds of claims beginning in 2013.

“Hospice is not a blank check for unscrupulous medical providers willing to admit patients who are not terminally ill,” said U.S. Attorney Byung J. “BJay” Pak. “It is reserved for those who truly need it.  We will also continue to prioritize cases where it appears that a medical decision, especially the decision to forego curative treatment, has been influenced by a kickback.”

The settlement resolved allegations that STG Healthcare submitted claims for patients from 2013 through 2017 who were not terminally ill and therefore ineligible for hospice services. The Medicaid hospice benefit is available for patients who have a life expectancy of six months or less. Also resolved were allegations that STG Healthcare unlawfully paid a physician in exchange for patient referrals to STG Healthcare’s hospice program.  The claims resolved by the settlement are allegations only, and there has been no determination of liability.

The settlement results from allegations filed in the Northern District of Georgia by former STG Healthcare employees Serita Samuel and Miranda Eskridge.  Ms. Samuel and Ms. Eskridge filed a lawsuit in the Northern District of Georgia in 2016 as whistleblowers under the provisions of the Federal False Claims Act and Georgia False Medicaid Claims Act.  The Georgia False Medicaid Claims Act awards treble damages and civil penalties for the submission of false claims to the Georgia Medicaid program.

The investigation spanned several years. Georgia Medicaid Fraud Division Nurse Investigator Nancy Dickerson played a pivotal role in the investigation along with Investigators Laura Soto and Tonia Medlin. Chief Investigative Auditor Denise Colson also assisted in the investigation. The State of Georgia was represented by Assistant Attorneys General Sara Vann and Rick Tangum and former Assistant Attorney General Elizabeth White.  The United States was represented by Assistant U.S. Attorney Austin Hall.