LOS ANGELES—A California company that runs nursing homes in 10 states has agreed to pay $48 million to resolve claims that it submitted inflated bills to Medicare for services that either were unnecessary or never performed, authorities said Tuesday.

The settlement reached with The Ensign Group Inc. was unsealed late Monday by a judge in Los Angeles and resolves a pair of whistle-blower lawsuits filed by two former company employees, federal prosecutors said.

"This settlement—one of the largest of its kind in United States history—demonstrates our commitment to protecting taxpayers who fund important programs that benefit millions of Americans, but don't want to see their hard-earned money wasted on fraud or abuse," U.S. Attorney Andre Birotte Jr. said.

Ensign did not admit liability as part of the settlement. In a statement released last month, Ensign CEO Christopher Christensen said the company, based in Orange County, will continue to enhance its compliance program and will strive to provide high-quality health care services.

Ensign is accused of turning in false Medicare claims for more than a decade at six of its skilled-nursing facilities in Southern California. Authorities said the claims for physical, occupational and speech therapy services were not medically necessary and some patients were kept in the nursing homes longer than they needed to be.


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The company also is accused of offering incentives to therapists and others to achieve high Medicare revenue targets that could only reached by billing at higher rates or extending therapy for longer periods than the patients needed.

The lawsuit was filed under the provisions of the federal False Claims Act, which allows people who act as whistle-blowers to sue and recover money they believe was obtained through fraud against the federal government.

It hasn't been determined how much money the two whistle-blowers in the case will receive.