Kindred Healthcare Inc. said on Tuesday it will pay $125 million, plus interest, to settle a Department of Justice investigation of its RehabCare Group Inc. unit. Kindred expects to make the payment during the first-quarter of 2016. The healthcare company had already recorded a loss reserve of $125 million related to the DOJ investigation, and has recorded an additional $2 million fourth-quarter loss reserve to cover additional costs. The settlement relates to allegations that RehabCare, which Kindred acquired in June 2011, provided rehabilitation therapy services to patients in nursing centers were not delivered or billed in accordance with Medicare requirements. RehabCare agreed to the settlement without any admission of wrongdoing. Kindred’s stock, which slumped 2.3% in midday trade, has tumbled 31% over the past three months, while the S&P 500 has lost 4.5%.
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