Newman Law Offices announces settlement Encore Rehabilitation to pay $4.033 Million to settle whistleblower case


Skilled Nursing Rehabilitation and Therapy company, Encore Rehabilitation Services, LLC (Encore) which services hundreds of skilled nursing facilities in 25 states will pay $4,033,346 with interest settling a False Claims Act lawsuit alleging healthcare fraud. The case, captioned UNITED STATES EX REL REZA SAFFARIAN AND AUDREY THEILE V. ENCORE REHABILITATION SERVICES, LLC ET AL NO 1:16-CV-605-JTN-ESC (W.D. Mich.) alleged submission of fraudulent and false claims to Medicare Part A for the facility at Autumn woods, Bay Shores. The whistleblowers who filed the case, Reza Saffarian and Audrey Theile are represented by Jeffrey A. Newman of the Newman Law Offices of Massachusetts and co-counsel Marc Vezina of Michigan.

The Complaint alleged Encore violated the False Claims Act by knowingly causing three Michigan skilled nursing facilities to submit false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary or skilled, the Department of Justice announced today.  Encore, based in Farmington Hills, Michigan, provides rehabilitation services to patients at over 600 health care facilities, including skilled nursing facilities, in over thirty states.

This settlement resolves allegations that Encore’s policies and practices at three Michigan skilled nursing facilities resulted in the provision of unreasonable, unnecessary, or unskilled rehabilitation therapy or the recording of therapy minutes as individual therapy when concurrent or group therapy was actually provided.  The settlement relates to Encore’s alleged conduct at the Autumn Woods Healthcare Facility in Warren, Michigan between Sept. 1, 2012, and July 31, 2018, the Bay Shores Senior Care and Rehab Center in Bay City, Michigan, for the period from April 1, 2013, to April 6, 2017, and MediLodge of Yale in Yale, Michigan, for the period from Oct. 1, 2010, to April 6, 2017.

Contemporaneous with the civil settlement, Encore entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Health and Human Services – Office of Inspector General (HHS-OIG) requiring, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks.  The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.

The settlement resolves allegations originally brought in lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act by Linda Anderson, Reza Saffarian and Audrey Theile, and Adam LaFerriere, former Encore employees.  The False Claims Act permits private parties to file suit on behalf of the United States and to share in any recovery.  The amount to be recovered by the private parties in this matter has not been determined.

The matter was handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorneys’ Offices for the Eastern District of Michigan and the Western District of Michigan, and the HHS-OIG.

Attorney Newman represents whistleblowers nationwide in cases of Medicare and Medicaid fraud, Pharmacy Fraud, Pharmaceutical Fraud, Securities and Exchange Whistleblowers, IRS Whistleblowers and Military Contract Fraud. His telephone number is 617-823-3217 and his email address is