Hospice Fraud: Schemes, Evidence, and the Medicare Rules They Exploit

Hospice fraud turns a patient’s enrollment, medical record or referral into a claim the health care provider knows Medicare should not pay. It can mean keeping ineligible patients on hospice, billing for care they never received, charging for a higher level than they needed, or buying the referral that brought them in. Inside the business, the pressure can arrive as an admissions target, an instruction to rewrite a nurse’s assessment or a decision to keep billing after an audit. The patient file tells one story. The people who worked on it may know another. Patients lose care, families face bills the hospice should cover, and taxpayers pay for the scheme.

How Medicare Hospice Care Works

Hospice provides care for people approaching the end of life. The hospice takes responsibility for care related to the terminal illness, including nursing, drugs, equipment and supplies. A team develops the patient’s plan of care and coordinates the services, whether the patient lives at home or in a facility.

Under Medicare’s hospice coverage manual, eligibility requires a physician’s certification that life expectancy is six months or less if the illness runs its normal course. The patient or an authorized representative must also elect hospice. Once a patient elects hospice, Medicare pays the hospice for care tied to the terminal illness. Coverage continues for unrelated care and services from an independent attending physician. A false election therefore changes more than a billing entry. It changes who is responsible for the patient’s care.

The physician’s certification needs clinical support and an individualized explanation of the prognosis. The physician must compose that explanation from the medical record or examination. What the physician received matters as much as the signature at the bottom.

What Happens If a Hospice Patient Lives Longer Than Six Months?

Medicare can continue hospice coverage while the patient remains eligible and receives the required recertifications. The benefit allows two 90-day periods followed by unlimited 60-day periods. Each requires certification. Hospice face-to-face documentation becomes part of recertification before the third period and each later period, when a hospice physician or nurse practitioner must conduct the encounter.

The question at recertification is whether the patient’s condition still supports the prognosis. The clinical review is supposed to follow the patient as the condition changes. The business has a financial interest in the answer.

Why Hospice Payment Rewards the Enrolled Day

Medicare hospice payment reached $27.5 billion in fiscal 2024, nearly double the spending in fiscal 2015, according to the Government Accountability Office’s June 2026 report. Routine home care pays for each enrolled day, including days without a visit. Care costs are highest around admission and death, with a less expensive stretch between them. The daily payment makes a long stay with limited services attractive to a provider trying to maximize its margin.

GAO’s analysis shows how much work can vary under the same daily payment structure.

2.5

visits per patient per week, on average, among the lowest-visit fifth of selected hospices.

The highest-visit fifth averaged 5.5 visits per patient per week.

Selected patients discharged in 2024.

Government Accountability Office, Medicare Hospice, June 2026

The report found that the low-visit group effectively received twice as much per visit. It estimated a $7.6 billion difference between the selected patients’ routine hospice payments and what comparable services would have cost at adjusted home-health rates paid per visit.

Among hospice patients who died in 2024, the Medicare Payment Advisory Commission reported a median lifetime hospice stay of 19 days and an average of 99.6 days. An admissions policy aimed at long stays can shape revenue well beyond the month in which patients arrive.

Why Facilities Matter to the Business

Assisted living and nursing facilities bring potential patients together in one place. A hospice can serve several residents without traveling between homes, and facility staff may already provide overlapping care. That makes the referral relationship valuable before anyone discusses a referral fee.

Assisted living hospice care involved a median accumulated stay of 98 days, more than twice the median at home, in the HHS Office of Inspector General’s 2015 study, Medicare Hospices Have Financial Incentives to Provide Care in Assisted Living Facilities. The study examined beneficiaries who received hospice in 2012. It connected the longer stays and less complex care to the financial attraction of that setting.

Milliman’s Hospice Medicare Margins, published in July 2019, found net Medicare margins of 19.9% at for-profit hospices and 3.0% at nonprofits for fiscal 2017. The National Partnership for Hospice Innovation, a group of nonprofit providers, commissioned the report. Its findings linked higher margins with facility care and very long stays.

That makes the pattern harder to explain by diagnosis mix alone.

How Is Hospice Fraud Committed?

Hospice fraud cases show how a false claim can begin before a bill exists, when management changes the information used to admit or recertify a patient. Intake, clinical staff, physicians and billing staff can each finish their piece of the paperwork while the account of the patient’s condition gets further from what the visiting nurse saw.

At Creekside Hospice in Las Vegas, a patient getting better could be bad for business. In its November 2014 announcement, the Justice Department alleged that staff were discouraged from recording known improvements in patients’ health so Medicare and Medicaid would keep paying. The hospice allegedly called those entries “Chart Killers.” In the government’s account, good news about a patient was a threat to the claim.

The whistleblowers’ complaint against Agape Senior Community describes a nurse who recorded that a patient had driven to the store. The allegation makes the instruction behind a misleading chart unmistakable:

Falsified hospice records can include a missing observation as well as an invented one. An assessment, the version sent for certification and an instruction to change it can explain why the final record looks different from the patient the nurse visited. That is the connection an insider can supply when a claim shows only the finished result. The Creekside allegations later became part of the broader settlement announced in 2017 with Genesis Healthcare.

Who Makes the Decisions, and Who Sees Them?

Owners and administrators control admissions targets, staffing and the response to bad news. Medical directors and certifying physicians supply the clinical approval. Marketers and facility relationships influence the flow of referrals. Ownership matters because those decisions can come from a parent company as well as the local hospice.

Hospice ownership shifted as for-profit providers accounted for the entire net increase in hospices from 2000 through 2017, the Government Accountability Office found. The government alleged that Hospice Care of Kansas and its parent Voyager HospiceCare tied clinical pay to patient counts and delayed discharges. For an insider, the organizational chart helps explain where an admissions instruction began and where a clinical objection stopped.

Nurses and aides see the patient and know what care was given. Intake staff see the election paperwork. Billers see dates, levels of care and repeated claims across patients. Finance and compliance staff see compensation arrangements, cap calculations, internal warnings and the response. The clinical record, the payment record and the instructions inside the company meet in the same case.

What Evidence Is Needed to Prove Fraud?

In healthcare fraud cases, evidence connects what happened to the patient with what the hospice told Medicare and what management knew. The nurse’s original assessment, the signed certification, the billed day and the manager’s instruction can show where the accounts diverged. That is the connection we help insiders make.

Hospice Fraud Whistleblowers

Hospice fraud whistleblowers have included a former Hospice Care of Kansas nurse whose announced award was $1.34 million. Her qui tam case raised the allegations the government settled. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. The insider’s contribution is knowing how the clinical and business decisions fit together.

Oversight Reaches the Provider and the Patient File

The Centers for Medicare & Medicaid Services administers enrollment and payment, state survey agencies and accrediting organizations inspect care, and the Inspector General investigates and audits. The Justice Department pursues False Claims Act cases, including cases brought by whistleblowers.

In Hospice Deficiencies Pose Risks to Medicare Beneficiaries, published in July 2019, the Inspector General found that more than 80% of surveyed hospices had a deficiency during 2012 through 2016. Common problems included care planning, aide management and patient assessments.

Entry controls reach another part of the business. The nationwide hospice enrollment moratorium took effect for six months beginning May 13, 2026 under the Centers for Medicare & Medicaid Services notice. It covered new Medicare hospice enrollments, new practice locations and specified ownership changes requiring new enrollment. The notice left already enrolled hospices participating.

The Fraud Patterns Behind the Claims

Hospice Eligibility Fraud and Delayed Discharges

Alleged hospice eligibility fraud led to a $6.1 million settlement with Hospice Care of Kansas and Voyager HospiceCare in 2012. Beyond the pay incentives and delayed discharges, the government alleged that staff received instructions to describe conditions misleadingly. The pressure to admit and keep patients reached the people writing the clinical record.

GAO also found higher live-discharge rates at low-visit hospices. A high rate of patients leaving hospice alive can point to poor care or admissions of patients who did not qualify.

Hospice Enrollment Without Informed Consent

Hospice enrollment without informed consent can put a patient into an initial 90-day benefit period without the choice Medicare requires. The election records who chose hospice and when coverage began. The patient or representative can choose to end the hospice election. The hospice must stop billing from the discharge date. In the Creekside complaint, the government alleged that management discouraged staff from allowing patients or families to revoke their elections. A request to leave, the recorded end date and the subsequent claims can show whose decision the hospice actually followed.

The election statement names the hospice, records the start date and carries the patient’s or representative’s signature acknowledging comfort-focused care and the coverage given up. For care tied to the terminal illness, a false election can interrupt Medicare payment for treatment outside the hospice. When the hospice classifies care as unrelated, the attachment to the election statement must explain that classification if requested.

Hospice Billing Fraud and Unsupported Levels of Care

Alleged hospice billing fraud involving continuous home care led to Odyssey HealthCare‘s $25 million settlement in 2012. The government alleged that the care was unnecessary or failed 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 during a day, with more than half provided by nursing staff. It addresses a crisis that requires predominantly nursing care to keep the patient at home. The crisis notes, staffing hours and billed days have to tell the same story.

What Are the Criteria for a GIP Hospice?

General inpatient care, often called GIP, addresses pain or symptoms that cannot be managed in another setting. Inpatient respite gives the caregiver a break. Billing one as the other changes what Medicare pays. General inpatient hospice billing drew an Inspector General review projecting $268.1 million in inappropriate payments for 2012, representing 26% of payments for that level. Hospices commonly billed the higher level after symptoms were under control or when patients never needed it.

Invented Visits and Missing Care

Hospice billing for services not provided can depend on an invented visit record. The Creekside allegations reached physician visits that allegedly never occurred and records changed after billing to make claims appear payable. A visit schedule, the clinical entry and the people who were actually present can tell different stories. A fabricated entry can conceal missing care and make an unsupported admission or continued stay look medically justified. The service record is doing work for the claim even when the service itself never happened.

The Agape complaint also alleged that patients or families received bills for medical and pharmacy services while the hospice was receiving federal payment for their care. An invoice sent to the family can reveal a different side of the same payment problem: whether the hospice shifted an obligation it had already been paid to meet.

Hospice Referral Kickbacks and Marketing Fraud

Alleged hospice referral kickbacks led to a $1.4 million settlement with Tapestry Hospice in the 2024 civil resolution. The government alleged that medical directors received monthly stipends and a signing bonus, with compensation rising when referrals increased and falling when they did not. The role was medical director. The alleged measure of value was the patient count.

Facility arrangements can buy referrals through services as well as money. The Agape complaint alleged that an assisted living facility received dedicated hospice nursing and aide staff because of the number of residents enrolled. The work performed, the facility’s own staffing obligations and the referral arrangement explain what the hospice was paying for.

Marketing incentives can reach the admission itself. In the settlement announcement for Good Shepherd Hospice, the government alleged that marketers, admissions nurses and executive directors received bonuses based on the number of patients enrolled. It linked those bonuses and admissions targets to claims for patients who did not qualify.

How Does the Medicare Hospice Cap Work?

Hospice aggregate cap pressure reached 28% of hospices in 2023, the share exceeding the limit in MedPAC’s March 2026 report. The cap limits what each hospice can collect from Medicare in a year, based on the patients it serves. Excess payments must be returned.

That pressure can reach admissions and discharge decisions. A whistleblower’s complaint against AseraCare alleged that management ordered patients discharged to avoid cap exposure regardless of their actual condition. The sequence of a cap problem, a discharge instruction and changes to the census can reveal a financial reason behind an apparently clinical decision.

The separate inpatient cap limits general inpatient and respite days to 20% of the hospice’s Medicare days, with a repayment calculation for excess reimbursement.

Keeping Overpayments After Internal Warnings

Hospice overpayments were among the allegations in the broader $19,428,570 settlement with Kindred Hospice, announced in July 2024. In its 2021 complaint against Curo Health Services, brought after whistleblower cases, the government alleged that Curo failed to ensure physicians received and considered complete, accurate clinical information. It also alleged that Curo retained Medicare and Medicaid payments after internal complaints and audits identified ineligible patients. The audit, who received it and the claims paid afterward belong in the same account.

Bring the Patient’s Story Back Into the Claim

If you know who pushed an admission, changed a chart, bought a referral or ignored an audit, speak with our whistleblower experts about the hospice practices you have seen. Our whistleblower experts shape your strongest hospice fraud case around the patients, decisions and payments. We bring in hospice fraud whistleblower lawyers who understand clinical records and Medicare billing, and stay with you through the process.