Beverly Braces for Fraud Probe Settlement
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Leading nursing-home chain Beverly Enterprises Inc. said it will take a second-quarter pretax charge of $175 million to $225 million in anticipation of settling a Justice Department Medicare fraud probe. The charge, which could equal Beverly’s earnings for the last eight years, indicates the company expects to pay the largest financial penalty ever against a nursing-home company for health fraud. Fort Smith, Ark.-based Beverly is the subject of a criminal grand jury probe into whether it inflated bills for nurses’ pay. Beverly shares closed at $6.25, off 44 cents, on the NYSE.
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