DOJ: Largest For-Profit Hospice Chain Allegedly Submitted False Medicare Claims

The nation’s largest for-profit hospice chain is among those being sued for allegedly submitting false Medicare claims, according to the Department of Justice; no determination of liability has been made as of yet. Chemed Corporation and its wholly owned subsidiaries, including Vitas Hospice Services LLC and Vitas Healthcare Corporation, which operates in 18 states and the District of Columbia, is alleged to have “knowingly submitted or caused the submission of false claims to Medicare for crisis care services that were not necessary, not actually provided, or not performed in accordance with Medicare requirements.” In the complaint (U.S. v Vitas Hospice Services, L.L.C.), the government claims the companies, in “maximizing Medicare reimbursement for as many patients as possible while disregarding patients’ Medicare needs and Medicare guidelines,” violated the False Claims Act and wasted tens of millions of dollars in Medicare funds.

The Allegations

One of the levels of hospice care, which is palliative treatment for a terminal illness (less than six months to live if the disease runs its course) rather than treatment intended to cure the disease, is crisis care. Crisis care involves immediate and short-term skilled nursing services for acute medical symptoms to keep the patient at home, and is reimbursed at the highest daily rate available for hospices. These companies allegedly increased the number of crisis care days being submitted to Medicare by (1) setting goals for the number of crisis care days; (2) using aggressive marketing tactics; and (3) pressuring staff to increase the numbers of these days, regardless of whether they were appropriate or had actually been provided. One example provided of a false claim was the billing of three consecutive days of crisis care for a patient whose medical records did not indicate a need for crisis care, but rather, showed that the patient was playing bingo during that time.

Another allegation against Chemed and Vitas is submitting false claims for hospice care for patients that were not terminally ill by (1) paying bonuses to staff based on the number of patients enrolled and those admitted for longer lengths of stay; (2) took adverse employment actions against marketing representatives that did not meet set monthly hospice admissions goals.

HEAT Taskforce

This suit is the result of the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which has recovered more than $10.3 billion since it was created in 2009 in False Claims Act cases involving fraud involving federal health care programs. The initiative is a joint effort between HHS and the DOJ. Between 2008 and 2011, HEAT efforts have led to a 75 percent increase in criminal health care fraud charges.