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HCR to pay state $2.5M to settle Medicaid fraud charges

Rochester Business Journal
January 9, 2014

HCR Home Care, the area's top woman-owned business, has agreed to pay $2.5 million plus interest to settle charges of Medicaid fraud, state Attorney General Eric Schneiderman said Thursday.

HCR founder and chairman Louise Woerner is out of town and could not be immediately reached for comment.  

The fraud charges stem from an investigation of charges to the state’s Medicaid program. Investigators allege $2.2 million worth of improper billings for non-patient care services from 2002 to 2006, including charges for non-covered services such as country club dues for company executives, marketing costs, interest costs on business loans and the cost of company vehicles.

Medicaid rules allow reimbursement only for necessary costs directly associated with patient care, Schneiderman said.

The charges also cover some 6,500 hours of work by 23 uncertified home health care aides. Until the investigation began, the attorney general said, HCR was unaware the aides were not properly trained. In addition, the company disclosed it had unwittingly submitted false timesheet claims from home health aides who inflated the hours they worked at an HCR client.

In a statement released Thursday, the company portrayed the $2.5 million settlement as not representing a significant amount of revenue over a four-year span for an agency of HCR’s size.
HCR cooperated fully with investigators during the fraud unit’s probe and "looks forward to continuing as a provider in good standing with the Medicaid program," the statement added.

HCR is one of four Rochester-area certified home health agencies eligible to directly bill the government-run Medicaid and Medicare insurance programs. It is the only privately owned, for-profit certified agency.

An insurance program for the poor, Medicaid is half paid for by the federal government and half paid for by states. Each state administers its own Medicaid program. In New York, the state government splits its share of Medicaid costs with counties.

Last month HCR CEO Mark Maxim outlined plans for the employee-owned HCR to expand into 10 North Country and Central New York regions.

In a previously planned move, Maxim has resigned but still serves HCR as a consultant, a company official said Thursday.

Begun after HCR secured approvals from the state Health Department in the first round of new certified-agency approvals the department had handed out in 19 years, the expansion continues growth into other upstate regions the Brighton-based HCR started making in 2006.

The expansion would help HCR offset losses in local business the company has seen due to the state’s Medicaid reform moves, Maxim told the Rochester Business Journal last month.

HCR ranks first on the new RBJ list of the area's largest woman-owned businesses, to be published in the Jan. 10 issue. The firm has 455 local full-time employees and employs 600 statewide.

(c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or e-mail

What You're Saying 

bob mullen at 3:08:40 PM on 1/9/2014
They need to be shut down for good. And someone needs to go to jail.

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