Attorney General Josh Stein Reaches $2.5 Million Medicaid Fraud Settlement
(RALEIGH) Attorney General Josh Stein today announced a $2,505,000 settlement to resolve allegations that Southeastern Behavioral Healthcare Services, LLC, a behavioral health business in Lumberton and Maxton, and its owners, Bertha Hutchinson and Virgil Hutchinson, submitted false claims to the North Carolina Medicaid program. The settlement was reached in partnership with the U.S. Attorney’s Office for the Eastern District of North Carolina.
“Medicaid dollars are taxpayer dollars, and health care providers need to be responsible stewards of this money,” said Attorney General Josh Stein. “I’m grateful for U.S. Attorney Easley’s partnership to protect the Medicaid program and fight health care fraud.”
“This is yet another example of the U.S. Attorney’s Office and the North Carolina Attorney General’s Office working together to proactively pursue fraud in our publicly-funded healthcare programs,” said U.S. Attorney Michael F. Easley, Jr. “Billing taxpayer-funded healthcare programs for services that are not rendered will not be tolerated. Our office will continue to work with the North Carolina Attorney General’s Office to root out healthcare fraud within our public healthcare programs and hold providers accountable for engaging in fraud, waste, and abuse.”
Between March 2016 and July 2020, Southeastern and the Hutchinsons allegedly submitted improper claims to the North Carolina Medicaid program for services they didn’t provide, that weren’t necessary, or were for patients who were incarcerated or deceased, where there was a pervasive lack of medical records supporting those services.
The federal and North Carolina False Claims Acts authorize the governments to recover triple the money falsely obtained, plus substantial civil penalties for each false claim submitted. It should be noted that the civil claims resolved by settlement here are allegations only, and that there has been no judicial determination or admission of liability.
This matter was investigated by the United States Attorney’s Office for the Eastern District of North Carolina, the Office of Inspector General – United States Department of Health and Human Services (OIG-HHS), and the Medicaid Investigations Division of the North Carolina Attorney General’s Office (MID).
About the Medicaid Investigations Division (MID)
The Attorney General’s MID investigates and prosecutes health care providers that defraud the Medicaid program, patient abuse of Medicaid recipients, patient abuse of any patient in facilities that receive Medicaid funding, and misappropriation of any patients’ private funds in nursing homes that receive Medicaid funding.
To date, the MID has recovered more than $1 billion in restitution and penalties for North Carolina. To report Medicaid fraud or patient abuse in North Carolina, call the MID at 919-881-2320. The MID receives 75 percent of its funding from the U.S. Department of Health and Human Services under a grant award totaling $8,453,116 for Federal fiscal year (FY) 2025. The remaining 25 percent, totaling $2,817,703 for FY 2025, is funded by the State of North Carolina.
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