Meal delivery company accused of illegally billing Medicaid $888K


by Jamie Grey

Posted on January 10, 2014 at 12:34 PM

Updated Friday, Jan 10 at 12:41 PM

BOISE -- State and federal prosecutors say an Idaho home meal delivery service illegally billed Medicaid for close to a million dollars, and they're suing to get the money back.

The government accuses a company called Homestyle Direct in Kimberly, of billing the state's Medicaid program for ineligible deliveries, like delivering to homes where no one was home because they were in the hospital, or in dozens of cases, deceased.

The company offers homebound people a variety of meal options that it makes, freezes and ships to clients, both on Medicaid and not. In the recently filed federal lawsuit, the government says over four years, Homestyle Direct overbilled Idaho Medicaid by $888,152.

"It's alleged that in providing meals to eligible recipients, that the business submitted claims to the state of Idaho and to the Medicaid program that were ineligible for reimbursement and that they did so knowingly or in reckless disregard of the fact that they were false claims," U.S. Attorney Wendy Olson said.

In the filed complaint, prosecutors say the problem is the company in some cases wasn't sending the Medicaid program's standard for nutritious meals, but was sending large portions of desserts instead.

Other allegations include that the company would auto-renew Medicaid client orders, even if they weren't sure the people were getting the meals. Prosecutors say that's something Homestyle Direct wouldn't do with private-pay clients.

"Homestyle Direct sent meals to recipients even if they did not order meals and without knowing whether the recipient was still alive or no longer in need of the meals. In contrast, Homestyle Direct did not automatically send meals to private-pay clients without a specific re-order," prosecutors wrote in the filed complaint.

Over four years, the lawsuit claims Homestyle Direct sent thousands of dollars in meals to 67 deceased recipients and billed the government. The lawsuit also claims meals would be left on doorsteps of people who were hospitalized or otherwise not home to eat the meals.

Dozens of claims of Medicaid fraud are investigated every year in Idaho. The Idaho Attorney General's Office says in its most recent year of data, there were 126 allegations of Medicaid fraud, and like in this case, most were complaints about providers.

Of those cases, the AG pursued six cases, with four convictions ultimately bringing in nearly $9 million. In the case against Homestyle Direct, the government says it's out nearly $900,000 but if convicted, a judge could order the company to pay more than $2.5 million.

The company's owners did not respond to KTVB's calls Thursday, but as in any case, they will likely file a formal legal response with the court.