Physical therapy company paying DOJ $16.6 million

KINGMAN, Ariz. -- A company providing physical therapy services at 450 offices in Nevada and 30 other states has reached a $16.6 million settlement agreement with the Department of Justice over allegations that it submitted false billing claims to Medicare and other federal health care programs.

The government on Thursday unsealed the settlement reached in July with Memphis, Tenn.-based Physiotherapy Associates.

"Submitting false claims to our nation's health care programs is tantamount to stealing from the American taxpayer," said Peter Keisler, assistant attorney general for the Civil Division.

He said the settlement sends a message that the government will not tolerate false billing practices.

Kerry Deering, an occupational therapist who also sits on the Kingman City Council, was the lead whistle-blower who brought the false-billing allegations to the attention of federal authorities.

Lawyer Bob Griffith said Deering exercised his right to file a lawsuit on behalf of the United States in April 2003, after he was fired by Physiotherapy.

Griffith said confidentiality requirements prohibited Deering from addressing rumors that he had been involved in the false-billing practice. He said it should now be known that Deering exposed rather than participated in the corruption.

"His reputation was destroyed in the town," Griffith said. "And, in fact, he was the American hero."

Griffith said the government will pay Deering nearly $3 million for his help in prosecuting the case.