Mass. Medicaid fraud case settled for record $25 million, AG’s office says

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The provider was using unlicensed workers at its mental health facilities.


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A private equity firm and two former top executives at a Massachusetts chain of mental health centers have agreed to pay $25 million in a whistle-blower lawsuit brought by the attorney general’s office, marking the largest MassHealth fraud settlement in state history, officials said Thursday.

South Bay Community Services (formerly known as South Bay Mental Health) has operated facilities in more than a dozen Massachusetts communities, including Boston, Brockton, Fall River, Lowell, Pittsfield, and Worcester, the office of Attorney General Maura Healey said in a statement.

South Bay has provided services to some 30,000 people receiving benefits through MassHealth, the state’s Medicaid program for low-income residents. But many of the staff at its mental health facilities were unqualified, unlicensed, and lacked proper supervision, violating MassHealth regulations, according to the AG’s office.


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