New York Attorney General Andrew Cuomo has announced a settlement with three home health agencies that are alleged to have defrauded Medicaid by billing the system for hundreds of unqualified health aides.

The settlement was reached with Brooklyn-based B&H Health Care Services Inc., doing business as Nursing Personnel Home Care; Excellent Home Care Services LLC, also of Brooklyn; and Manhattan-based Extended Nursing Personnel CHHA LLC of Manhattan. Cuomo's suit accused all three of sending hundreds of health aides with little or no training to provide health care for elderly and indigent New Yorkers.

Under the terms of the settlement, the three providers will return $23,963,100 to Medicaid, with $14,377,860 of that going to New York State. It is the largest settlement reached between New York's Medicaid Fraud Control Unit (MFCU) and the state's home health care industry. The MFCU is the largest unit in the Attorney General's criminal division and has the sole responsibility to prosecute wrondoing related to patient care in hospitals and nursing homes, as well as by home health agencies.

In order to become certified, home health aides in New York must complete a program licensed by either the Department of Health or the Department of Education. Any training program requires at least 75 hours of training, 16 of which must be supervised by a registered nurse. Cuomo's investigation revealed that health aides for the three agencies were operating with false credentials, many of which were sold by "schools" purporting to train home health aides. In addition to the civil suit, Cuomo's investigation resulted in convictions for improperly certified aides, the schools that provided their credentials, and the companies that employed them. More prosecutions are pending.

The suit, filed in May 2008, was part of Cuomo's "Operation Home Alone," a three-year-old investigation of home health care agencies in New York. The investigation was aided by allegations from two whistleblowers, who filed claims under both the federal False Claims Act and state laws. The False Claims Act, also known as the "Lincoln Law," encourages individuals to come forward with evidence of fraud against the government by promising them a substantial portion of any eventual recovered damages. The law has netted about $22 billion for the government since 1986, when significant changes to the satute expanded liability against alleged wrongdoers.

In a statement, Cuomo said, "The size of this settlement underscores the seriousness of the allegations and the importance of vigorous oversight of the Medicaid program and the medical care of our loved ones." He went on to assert that home health providers, which are funded by taxpayer dollars, "have an obligation to ensure that the health care workers they employ are qualified for the job."

This week, California Attorney General Jerry Brown announced that he has settled a suit accusing Schering-Plough of its own brand of Medicaid fraud. Brown's suit accused the pharmaceutical giant of inflating the price of drugs, including Albuterol, used to treat ashtma and other breathing problems. Brown's settlement, which netted $21.3 million, is one of three settlements that netted a grand total of $69 million.