A hospice company that operates out of multiple states has agreed to pay $5.5 million to resolve allegations that they violated the False Claims Act by submitting claims to Medicare for non-covered hospice services.
The settlement that was reached resolves allegations that the hospice knowingly submitted false claims to Medicare for hospice services for patients who were not terminally ill. Medicare patients considered to be terminally ill become hospice-eligible when they have a life expectancy of six months or less if their illness runs its normal course.
Per the settlement agreement, the United States alleges that from January 1, 2012, to December 31, 2014, the hospice billed Medicare for hospice care for certain patients with a diagnosis of dementia or Alzheimer’s disease at their Tennessee and Ohio locations. The patients were not terminally ill for at least a portion of the more than three years that they received care from the two locations.
Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), stated, “The decision to provide hospice services should be prompted by a patient’s terminally ill medical diagnosis and desire for palliative care, not a hospice provider’s desire to boost its profits. Our agency is dedicated to safeguarding both the Medicare program and Medicare patients. This settlement reaffirms HHS-OIG’s commitment to holding accountable providers who knowingly submit false claims to Medicare.”
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by former employees of the hospice and by a home health physician in Tennessee. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Under this settlement, the whistleblowers will share approximately $1,045,000.
The claims resolved by the settlement are allegations only, and there has been no final determination of liability.
Compliance Perspective
Issue
It is extremely important that all members of the healthcare team are aware of what may be considered a false claim. All Medicare covered services provided must be medically necessary, and the patient or resident must meet eligibility criteria for the services that are received. Failure to promptly report a false claim can result in lawsuits, fines, and other sanctions. Additional information is available in the Med-Net Corporate Compliance and Ethics Manual, Chapter 1 Compliance and Ethics Program, CP 2.3 General Legal Duties and Antitrust Laws.
Discussion Points
- Review policies and procedures addressing medical necessity related to Medicare coverage and for preventing and reporting a false claim violation. Update your policies and procedures as needed.
- Train appropriate staff on the requirements for Medicare coverage, the guidelines of the False Claims Act, and what is considered a false claim. Include information on how to report concerns and suspected violations, and that prompt reporting is mandatory. Document that the trainings occurred and place in each employee’s education file.
- Periodically audit staff understanding to ensure that they are aware of what should be done if they suspect inappropriate services are being provided or a false claim has occurred, whether intentionally or unintentionally. Conduct audits comparing documentation and billing routinely to prevent and detect errors before they progress to submission of a false claim.
