Opinion ID: 72598
Heading Depth: 4
Heading Rank: 1

Heading: Healthmaster, Garrison & Master Health

Text: Healthmaster, Inc. (Healthmaster) was a large, yet privately owned, home health care company based in Augusta, Georgia.2 Jeannette G. Garrison was its chief executive officer and sole shareholder.3 Healthmaster provided in-home nursing care for eligible persons with illnesses and disabilities. Approximately 92% of Healthmaster's revenues were derived from providing in-home nursing care to Medicare eligible patients. The balance was reimbursed by Medicaid and private insurance. Medicare guidelines provide reimbursement to Healthmaster for costs of direct patient care This diagram was prepared by counsel for the United States as Government Exhibit (GX) 1161G and attached to its brief. It should be viewed with that in mind. We believe it is helpful in understanding the factual background of this case. 1 The 133-count indictment was originally returned against six defendants: Jeannette G. Garrison, Healthmaster, Inc. (Healthmaster), and Master Health Plan, Inc. (Master Health), as well as Appellants. Prior to trial, Garrison entered a guilty plea to the conspiracy count and nine counts of making false statements. The submission of false cost reports to Healthmaster's fiscal intermediary formed the basis for her guilty plea. In return, she received a prison sentence and charges against Healthmaster and Master Health were dismissed. Garrison testified for the government at trial. The appeal of her sentence is currently pending before this court. 2 Healthmaster operated in five states with twenty-two divisions in 125 separate locations. It is estimated that 3,000 employees made two million home visits per year. Healthmaster had approximate gross annual revenue of $100 million. 3 Garrison also was the sole shareholder of Preferred Care Companies (Preferred Care or PCC), a holding company owning Healthmaster Pharmaceutical and Equipment Company, Inc. (Healthmaster Pharmaceutical), a durable medical equipment sales company, and Healthmaster Home Care of Georgia, Inc. (Healthmaster Home Care), a provider of home visitation services, other than skilled nursing. Both Healthmaster Pharmaceutical and Healthmaster Home Care were non-Medicare reimbursed companies. and reasonable and necessary overhead expenses.4 Reimbursements claimed by Healthmaster were submitted on cost reports to Aetna Life and Casualty Insurance Company (Aetna), the fiscal intermediary for HHS, who apparently did not discover any improper submissions. The cost reports required Healthmaster to declare whether or not its business transactions, such as purchasing supplies or services, were conducted with companies to whom it was related.5 Master Health Plan, Inc. (Master Health), Garrison's health maintenance organization (HMO), as a wholly owned subsidiary of Healthmaster, was a related company under Medicare guidelines.