False Claims Act Case Filed Against National For-Profit Hospice Chain

May 28, 2013 — Every year, The U.S. Justice Department uses the federal False Claims Act to reclaim millions of tax dollars lost to Medicare fraud. The qui tam provisions of the False Claims Act empower health care workers who discover Medicare billing violations to sue the wrongdoers and recover the lost monies. Employees of hospitals, hospice chains, and physicians’ practices are generally the best situated to notice irregularities when they occur and to notify the government.

Medicare Fraud Claims Alleged Against Vitas Hospice Chains

Chemed Corporation and a number of its hospice subsidiaries — including Vitas Healthcare Corporation and Vitas Hospice Services LLC — have been sued by the government in a False Claims Act lawsuit alleging Medicare fraud. In addition to running for-profit hospice facilities in 18 states (including Texas and California), Chemed also operates Roto-Rooter Group Inc., a national plumbing service company.

Medicare provides hospice benefits for patients with a terminal illness who are expected to live no longer than six months. Hospice care is meant to provide terminal patients with the best possible quality of life, offering means of pain and stress relief. Patients on Medicare who receive hospice treatment are no longer eligible to receive medical treatment that attempts to cure disease.

There are different levels of hospice care and Medicare reimburses them at different rates. The most costly level of care is crisis care, or continuous home care, for Medicare patients having acute symptoms for a short time. Crisis care requires that a patient receive skilled nursing services to allow the patient to stay at home, rather than be admitted to the hospital. Hospice providers receive hundreds of dollars more from Medicare each day for providing crisis care as opposed to routine hospice services.

Vitas Hospice Alleged to Have Bilked Millions From Medicare

According to the Justice Department, Vitas hospice facilities established targets for billing crisis care days to Medicare and pressured hospice staff to meet those goals, regardless of whether crisis care was necessary or was provided. Medicare was billed, for example, for three days of crisis care for one patient who was playing bingo during the alleged “crisis.”

The hospice providers are also alleged to have submitted false claims to Medicare for hospice services to patients who were not terminal. One patient who Vitas described as very healthy for her age, for instance, was admitted for hospice care. The companies paid bonuses to hospice marketing representatives who met monthly targets for the number of patient admissions and the lengths of stay. Marketing reps who did not fulfill company-established goals suffered repercussions.

The hospice providers’ False Claims Act violations allegedly resulted in reimbursements to the companies amounting to tens of millions of dollars.

Health Care Insiders Best Tipsters in False Claims Act Cases

False Claims Act violations surrounding improper bonus programs and patient enrollment targets, like this one, are often reported by concerned insiders. Sometimes a courageous marketing representative will notify the government. Other times, someone from the accounting and billing side of the practice will step forward. Whistleblowers who are willing to collaborate with the Justice Department need to understand their rights before taking action. With Medicare care fraud lawyers across the country, Waters & Kraus offers informants the experienced legal counsel they deserve. Contact us by email or call our qui tam attorneys at 855.784.0268 to learn how we can help you.

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