GREENFIELD — The U.S. Attorney’s Office has filed a joint complaint with the state Attorney General’s Office under the federal and Massachusetts False Claims Acts against 19 skilled nursing facilities in Massachusetts and Connecticut owned by the health care company RegalCare, which operates a rehabilitation clinic on Laurel Street.

The complaint alleges that RegalCare, at the direction of its owner Eliyahu Mirlis and an executive, Hector Caraballo, fraudulently caused the submission of claims to Medicare and Medicaid for “medically unreasonable and unnecessary services” to patients of RegalCare’s nursing facilities. The scheme allegedly resulted in millions of dollars in damages to the Medicare and Medicaid programs.

“As alleged, these defendants drained Medicare and Medicaid of millions of dollars and put vulnerable patients at risk — making them undergo unnecessary, and sometimes painful, services,” U.S. Attorney Leah Foley said in a statement. “When facilities prioritize profits over patient well-being, they endanger those in their care and undermine the integrity of our health care system. This office will continue to hold accountable those who exploit federal health care programs at the expense of patients and taxpayers alike.”

According to the complaint, RegalCare, at Mirlis’ direction, “systematically caused Medicare to be billed for the highest level of skilled rehabilitation therapy services” despite patients not clinically needing those services.

“Caraballo facilitated Mirlis’ plan by ensuring that RegalCare’s patient records supported billing for such services — including altering and amending records despite knowing he was not authorized to do so at his licensing level,” the Attorney General’s Office wrote. “The United States also alleges that RegalCare, through Mirlis and Caraballo, improperly directed RegalCare’s third-party billing company to bill Medicare for the highest-level skilled rehabilitation therapy services before the underlying necessary clinical documentation was even complete.”

The complaint also lists Stern Therapy Consultants, a New York long-term care consulting company, as a defendant under the allegation that it conspired with RegalCare to cause the submission of fraudulent claims to Medicare.

The government claims that Stern involved itself in the alleged scheme by scheduling therapists to provide unnecessary services, contrary to patients’ medical needs, to justify billing at the highest level.

“When Stern therapists refused to provide services they deemed unnecessary or unreasonable, Stern managers threatened to take employment action against those therapists to pressure them to capitulate,” the Attorney General’s Office wrote.

Between April 2018 and September 2023, RegalCare received more than $3.82 million in direct fee-for-service claims, the complaint states.

Though RegalCare Chief Operating Officer Mark Morley, when contacted by the Greenfield Recorder on Wednesday, asked for questions to be sent via email, the Recorder did not receive a response by press time.

Anthony Cammalleri can be reached at acammalleri@recorder.com or 413-930-4429.