Company to pay $2.8 million in Medicare fraud case

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By Mike Gertzman By Mike Gertzman

PHOENIX (AP) -- A private ambulance company that provides services in Arizona and 20 other states has agreed to pay the federal government more than $2.8 million to resolve civil allegations that the business defrauded Medicare, authorities announced Thursday.

Over a four-year period from 2007 to 2011, companies owned by Rural/Metro Corporation in Arizona, New York, Oregon and Delaware billed Medicare for numerous emergency patient transportation trips when the calls were not emergencies, leading to substantially higher payments from Medicare for the services, according to the government.

"The need to protect federal funds, including the Medicare trust fund, from fraud, waste and abuse has never been greater," John Leonardo, U.S. Attorney for Arizona, said in a statement. "This settlement agreement is a substantial recovery for taxpayers and sends a clear message that the federal government will not stand idly by when its programs lose money due to false claims for payment."

Leonardo said the government chose to settle the civil case "to avoid the delay, uncertainty, inconvenience, and expense of protracted litigation."

Under the terms of the agreement, Rural/Metro does not admit wrongdoing, but remains subject to investigation by the Internal Revenue Service and any criminal liability that may arise through ongoing federal probes of the company.

In a statement, Rural/Metro said it had reached a "voluntary civil settlement agreement" that does not include "any admission of liability."

"The company agreed to settle the matter in order to avoid expensive and time-consuming litigation and to maintain focus on ensuring its patients continue to receive high quality emergency medical care," the statement read.

The company said the payment will have no effect on its ongoing restructuring efforts under a bankruptcy filing.


Rural/Metro Reaches Voluntary Settlement Agreement

SCOTTSDALE, Ariz. (Dec. 26, 2013) – Rural/Metro Corporation today announced that the Company and six of its operating subsidiaries have reached a voluntary civil settlement agreement with the United States Attorney’s Office for the District of Arizona, acting on behalf of the Office of Inspector General of the Department of Health and Human Services, concerning certain Medicare payments to Rural/Metro that occurred between 2007 and 2011.

The settlement agreement does not include any finding of wrongdoing or any admission of liability by Rural/Metro. The Company agreed to settle the matter in order to avoid expensive and time-consuming litigation and to maintain focus on ensuring its patients continue to receive high quality emergency medical care throughout the communities it is privileged to serve across the country. 

Under the terms of the settlement agreement, Rural/Metro has agreed to pay approximately $2.8 million to the federal government.  The agreement was approved as part of and is not expected to impede the successful completion of the Company’s Chapter 11 restructuring, which is projected to be within the next few weeks. The settlement with the U.S. Attorney’s Office does not include any additional integrity provisions or extension to the Corporate Integrity Agreement (“CIA”) under which Rural/Metro has been operating for the past year.

Rural/Metro is pleased to have reached a resolution to this matter. The Company is committed to ensuring that it remains in strict compliance with all applicable laws, regulations and standards in each of the markets and jurisdictions in which it operates.


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