California Hospice Defrauds Medicare by Stretching Patient Life Expectancies

False Claims Act , Healthcare Fraud

When a program created to provide important end-of-life services is so often the victim of fraud, should we blame the broken system itself, or instead turn focus to those committing the fraudulent acts? It seems an easy question to answer, but describes the ongoing situation of hospice care – a system which regularly undergoes scrutiny in light of the ever-present fraudulent activity that goes on behind facility doors. Hospice care as a whole was formed with the intention to provide sympathetic care and spiritual support to patients suffering from terminal illnesses; unfortunately, it is all too common that those involved in providing this care use the virtually nonexistent quality metrics required by Medicare in order to exploit the system, and in turn, cause harm to innocent patients.

Such is the case in the allegations brought against California Hospice Care (CHC), a Covina-based facility that employed two doctors who were later found guilty of doing just that – prioritizing their greed over the needs of those in their care. However, instead of causing patient deaths (as is so frequently seen in cases of hospice fraud), they were apprehended by evidence of the opposite: individuals that they had certified to “require” palliative care were outliving the six-month life expectancy that deems a patient eligible for hospice. Though this does happen from time to time, multiple instances of extended stays make it fairly obvious that foul play may be a factor; this became increasingly evident when former CHC patients were still alive to testify against the facility at a trial beginning a whopping seven years after the scheme allegedly began.

In order to receive government reimbursements for patients that were clearly not in need of hospice care, the doctors in question repeatedly falsified the nature of patient illnesses in order to ensure they were eligible to be billed under Medicare standards. At times, the owners of CHC went so far to the extent of paying patient recruiters, sometimes referred to as “marketers” or “cappers,” to source and refer patients that were not terminal; facility personnel then went on to forge medical records in order to make these patients appear to be far more ill than they were in order to continue billing for these unnecessary services.

The indictment also alleged that one of the doctors employed by CHC collected tens of thousands of dollars in “kickbacks,” or illicit payments in return for referrals, to further profit by means of placing patients in facilities that did not suit their best interests. In doing so, he directly violated the Anti-Kickback Statute – a federal law which prohibits any such exchange. Due to the nature of his actions coupled with his fraudulent certification of patients, his medical license was revoked upon sentencing.

This scheme, which took place between March 2009 and June 2013, resulted in Medicare and Medi-Cal paying nearly $7.4 million in false claims to CHC of the $8.8 million submitted over the course of those four years. Thankfully, the conspirators were apprehended before more patients were victimized – and to those who already were, restitution was paid. There is still much work to be done before this “broken system” can be fixed – but each scheme uncovered is another step towards once again making hospice a safe and reputable resource for end-of-life care. With the help of whistleblowers and other individuals who seek to protect these patients and recover already-limited Medicare funds, the sanctity of government healthcare can be preserved and care can be provided to those who truly need it.

Whistleblower Justice Network Can Help You

Whistleblower Justice Network partners with whistleblowers to bring to justice those who profit from potentially endangering the lives of patients. We assist individuals who bring forth valuable information in filing cases against those who submit fraudulent claims in order to bilk government healthcare programs.

If you have meaningful information regarding hospice fraud that you believe is in violation of the False Claims Act, Whistleblower Justice Network can help. Working alongside world-class legal counsel, we will ensure you are protected to the fullest extent of the law and that you receive credit for the information you bring to the U.S. government. Partnering with whistleblowers is all we do. Visit us at www.whistleblowerjustice.net, or call us at 844-WJN-4ALL.

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