Odyssey Hospice: One Nurse, Two Patients, and a Continuous Care Bill

In the Odyssey hospice fraud settlement, Odyssey HealthCare agreed to pay $25 million to resolve allegations that it billed Medicare for unnecessary or improperly provided continuous home care. The complaints put a practical question behind that payment: how could a nurse provide continuous care to one patient while recording care for another during the same hour?

The Department of Justice announced the resolution on March 1, 2012, covering claims from January 2006 through January 2009. Three qui tam suits brought by former employees raised the allegations.

What Qualifies for Continuous Care in Hospice?

Continuous home care pays for skilled nursing during an acute crisis so a patient can remain at home. In its account of Odyssey’s billing, the Justice Department described it as the highest hospice reimbursement rate, several hundred dollars a day above routine care.

That difference is the center of this hospice billing fraud case. The government alleged both unnecessary continuous care and care that failed to meet Medicare’s requirements.

What Is the Minimum Number of Hours of Continuous Home Care?

Continuous home care requires at least eight hours of qualifying care in a day, predominantly nursing care, with payment by the hour. HHS-OIG’s explanation of the payment requirements connects those hours to brief periods of crisis. The time belongs to a particular patient and the care that patient received. That is why a nurse’s schedule matters alongside the clinical chart.

What the Odyssey Complaints Alleged

One Nurse Assigned to Two Patients

A triage supervisor and an on-call registered nurse alleged that Odyssey billed continuous care while assigning the same nurse to other patients. Their complaint in the Eastern District of Wisconsin described overlapping entries in which a nurse recorded services for different patients during the same hour.

One example involved patients in different wings at Dove Health Care at Glendale in Milwaukee. Another concerned a patient who allegedly received occasional medication doses while Odyssey billed continuous care. The complaint alleged that the patient’s condition did not meet the crisis requirement and that the patient did not receive the required hours of direct care.

The supervisor knew the scheduling and reviewed the records. The on-call nurse assessed patients and saw the care firsthand. Their allegations joined what happened at the bedside to what appeared on the schedule and the bill.

A Replacement Patient for Continuous Care

The same complaint alleged that, after a continuous-care patient died, Odyssey sent an on-call nurse to assess patients at nursing homes to find someone else to place on continuous care. Her supervisor allegedly criticized her for failing to find a replacement. In that account, the search began with a vacancy in continuous care.

The complaint also described the instructions nurses received:

The alleged instruction reached ordinary events in hospice work: a medication order, a changed request, a longer visit. The complaint said the manual omitted the requirement to reserve continuous care for periods of crisis.

Internal Audits and Referral Pressure

Another former employee’s complaint alleged that internal audits found substantial continuous-care billing that did not meet the criteria in 60% of the charts, and that Odyssey failed to report those results.

That complaint also alleged that Odyssey relied on nursing-home staff to provide the bulk of services to reduce expenses and maximize reimbursement. It also described paid medical directorships and free care intended to induce physician referrals.

The nurses’ complaint described a different benefit to a referring facility. A case manager allegedly promised continuous care to patients at Wisconsin Lutheran Child & Family Services in Milwaukee. When an on-call nurse assessed them and found them inappropriate for that level, her supervisor allegedly ordered her to apologize. The facility would receive intensive nursing services at Medicare’s expense. The complaint alleged that Odyssey obtained referrals in exchange for promoting this care.

Daily Payments and Admission Targets

Odyssey’s growth strategy tied admissions to cost control. The Journal of Finance Case Research case study Odyssey Healthcare: Issues of Fiduciary Malfeasance and Class Action Suits, published in 2008/2009, describes rapid geographic expansion, an emphasis on increasing patient census and extensive marketing training.

The paper explains the financial attraction of longer stays under a fixed daily payment. Costs rose around admission and near death, with a less expensive stretch in between. The daily revenue continued through that middle period. Its account of Odyssey’s sales incentives is equally direct:

In its account of 2004, the paper describes more than 200 Community Education Representatives and quarterly bonuses based on growth. The later employee complaint alleged monthly admission quotas for Odyssey’s marketers. The bonus plan and the admission quota explain the pressure behind a patient record.

The same complaint alleged that long-stay patients moved from the VistaCare Philadelphia program to the Odyssey Philadelphia program to manipulate patient-day averages. The hospice cap limits what Medicare pays a hospice in total, based on how many patients it serves. That allegation connects patient transfers to the business’s payment ceiling.

The Earlier Odyssey Hospice Settlement

Odyssey’s earlier settlement concerned hospice eligibility, covering alleged false claims for patients who were not terminally ill during 2001 through 2005. In its July 13, 2006 announcement, the Justice Department said Odyssey had paid $12.9 million, the first of the two settlements.

The former employee behind that case described auditing offices, identifying patients who did not qualify and meeting resistance when she recommended discharge. Her complaint also alleged pressure on general managers to admit ineligible patients and backdated recertifications.

The earlier case concerned who qualified for hospice and stayed enrolled. The later continuous-care resolution concerned the need for a more intensive level and the services billed at that level. Those are different decisions inside a hospice, and employees can see either one.

Corporate Integrity Agreements Across Both Settlements

Each settlement came with a five-year corporate integrity agreement with HHS-OIG, the first in July 2006 and the second in February 2012.

The continuous-care billing allegations covered a period when Odyssey was already operating under its first integrity agreement. The next settlement brought another payment and another agreement.

What Evidence Is Needed to Prove Fraud?

Our whistleblower experts work with you to connect the care patients needed and received to the hours billed and the decisions behind those bills. The complaints make those connections concrete: overlapping nursing records, bedside assessments, a continuous-care manual, internal audit results and promises made to referring facilities.

Different hospice employees see different parts. A scheduling supervisor may know who covered the shift. A nurse may know what symptoms required treatment. An auditor may know when management learned that charts did not support the billed care. We work with insiders to connect those accounts to the claims and the decisions that kept them coming.

The Same Pattern at St. Joseph Hospice

The same mismatch appears in another provider’s case. In the St. Joseph Hospice complaint, employees alleged that chart reviews found continuous-care bills for patients who were not in crisis. They also alleged that the hospice marketed around-the-clock care to hospitals as a way to discharge patients sooner and save money. The pattern joins a clinical claim to a sales promise: intensive care offered for the referring institution’s benefit, with Medicare paying the bill.

The Odyssey Whistleblower Awards

The Justice Department announced that the former employees who brought the three suits would receive more than $4.6 million collectively from the continuous-care resolution. The former employee behind the earlier eligibility case received a $2.3 million award.

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

You Know Who Covered the Shift

If you saw continuous-care assignments that the patient charts or nursing hours could not support, speak with our whistleblower experts about the continuous-care bills at your hospice. We build the case with you, bring in hospice fraud whistleblower lawyers who understand clinical records and Medicare billing, and stay beside you throughout the case.