Hospice of the Comforter: Admit First, Check Eligibility Later

The Hospice of the Comforter lawsuit ended in a $3 million settlement over allegations that the hospice billed taxpayer-funded Medicare for patients who were not terminally ill. A former vice president of finance brought the case. His complaint connected the admission decisions to copied patient charts, Medicare denials and management’s response when its own clinicians began discharging patients as ineligible. For someone inside a hospice’s finance or clinical team, the story is recognizable: the patient record says one thing, the revenue depends on another, and the warnings reach management.

The Department of Justice announced the settlement on November 5, 2013. Hospice of the Comforter was headquartered in Altamonte Springs, Florida, and served Seminole, Osceola and Orange counties. The hospice fraud case was brought under the False Claims Act in the Middle District of Florida, and the government joined it. The settled allegations covered conduct between December 2005 and December 2010.

Admission Before Eligibility

The government alleged that Hospice of the Comforter directed staff to admit all referred patients regardless of whether they qualified for the Medicare hospice benefit. Its account of the admission instructions went further: the chief executive allegedly told employees to admit Medicare patients before anyone had determined that they were eligible.

The whistleblower’s complaint described a particular version of that policy. The CEO allegedly favored admitting anyone who arguably met the criteria, then reevaluating the patient after 90 days of observation. Enrollment came first. The decision supporting it could wait.

That sequence goes to the center of hospice eligibility fraud. Medicare requires a physician’s certification of a prognosis of six months or less if the illness runs its normal course. Patients also elect comfort care in place of Medicare-covered treatment intended to cure their terminal illness. The clinical judgment is what supports payment from the beginning. In this complaint, management allegedly treated admission as a chance to find out later whether the patient belonged in hospice.

Who Determines Eligibility for Hospice?

Physicians certify terminal illness, using clinical information about the individual patient, as CMS explains in its hospice coverage manual. The hospice physician and the patient’s attending physician, if there is one qualified to certify, provide the initial certification. An authorized hospice physician handles subsequent certifications.

The Same Chart, Month After Month

The Justice Department alleged that Hospice of the Comforter falsified medical records, employed field nurses without hospice training and limited physicians’ roles in assessing whether patients were terminally ill. The complaint explains what one of those recordkeeping practices allegedly looked like inside the computer system:

The whistleblower alleged that the practice repeated descriptions of patients whose conditions were stable. He also described a review of denied claims by the associate medical director and nurses. According to the complaint, that review found missing physician documentation and electronically repeated notes that failed to show the decline being claimed.

Those allegations connect clinical work to hospice billing. A nurse’s observation, the chart that carries it forward and the material a physician reviews can all affect the same claim. The alleged copying mattered because an old entry kept doing the work of a current assessment while Medicare kept receiving bills.

What the Medicare Audit Changed

The government’s intervention announcement alleged that, after notice of a Medicare contractor audit, Hospice of the Comforter formed an internal eligibility committee and discharged at least 150 patients in 2009–2010 as ineligible.

The whistleblower’s complaint described escalating scrutiny of patient charts and a 77% denial rate during the follow-on review. It alleged that the hospice nevertheless refunded none of the earlier Medicare payments for those patients. The review affected whether claims would be paid, but, in the whistleblower’s account, it did not produce a corresponding effort to return money already collected.

The complaint also alleged that the CEO intervened in some discharge decisions, insisting that patients the committee had found no longer terminally ill be readmitted and billed to Medicare.

The committee’s patient list, the eligibility findings, the denied claims and the readmission instructions describe successive decisions about the same care. They also identify where clinical staff and management allegedly parted company.

What the Finance Office Could See

The former finance executive alleged that some patients had accumulated more than $250,000 in billing during their stays. He presented an analysis of discharged patients and their billing histories, with a worst-case overbilling estimate of $11 million.

His account linked the dollars to particular patients. He allegedly gave the compliance committee a detailed list of discharged patients and their total billing since admission, then pressed for an audit to examine whether they had qualified when care began. According to the complaint, the CEO immediately rejected that audit.

The complaint also describes finance reports to the board about declining census and Medicare denials, followed by management instructions to make future presentations positive.

An outside compliance review allegedly met a different restriction:

The alleged instruction reached the consultant’s fee: the hospice would pay for conclusions spoken aloud, but no written account. Alongside the rejected patient audit, that describes management controlling how much of the problem would be examined and put on paper.

Why Patient Days Mattered

Medicare’s daily hospice payments made both admission and continued enrollment financially important. The payment arrangement described in the complaint paid for enrolled days regardless of how much service the hospice supplied on a particular day. MedPAC’s payment analysis describes higher care costs near admission and death, with less intensive care in between.

The Inspector General’s 2015 study of hospice care in assisted living found longer stays and higher Medicare payments for beneficiaries in that setting than in other settings. It explained the broader incentive plainly:

At Comforter, the complaint alleged a direct connection between the census and executive compensation: the CEO received quarterly bonuses based on billable patient days. It also alleged that physicians worked as contractors paid per patient visit, so discharging a patient reduced their patient load and compensation.

In the whistleblower’s account, keeping patients enrolled supported the hospice’s revenue and the compensation of people involved in deciding whether they stayed.

The Settlement Required Compliance Changes

The corporate settlement included a Corporate Integrity Agreement with the Department of Health and Human Services Inspector General. Hospice of the Comforter agreed to procedures and reviews intended to detect and prevent conduct like that alleged in the case.

The Former CEO’s Exclusion

The former CEO agreed to a three-year voluntary exclusion from Medicare, Medicaid and other federal health care programs, effective October 24, 2013.

What Evidence Is Needed to Prove Fraud?

In Comforter’s case, the complaint connected admission instructions, clinical records, Medicare claims and management’s response to eligibility problems. It brought those pieces together through copied charts, discharge decisions, billing histories, board reports and the alleged refusal to examine earlier payments.

The same connection appeared in Caris Healthcare’s settlement. The government alleged that internal audits, nurses and the chief medical officer warned Caris about ineligible patients. Caris allegedly continued billing and took no meaningful action to determine whether it had received improper payments before those warnings. In both cases, the response to information already inside the hospice became part of the allegations.

Hospice whistleblowers can see that connection from different positions. The clinician knows the patient. The finance employee sees the billing and denials. The compliance employee sees which concerns reached management. Our whistleblower experts work with insiders to build a case from those accounts.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know Where the Decisions Changed

If you saw clinical findings overridden, charts carried forward or billing concerns kept out of a written report, speak with our whistleblower experts about what happened inside the hospice. We build your strongest hospice whistleblower case with you, bring in hospice fraud whistleblower lawyers who understand eligibility and Medicare billing, and stay beside you through the pursuit of a recovery.