Health Care

Hospice to pay $4 million to settle Medicare fraud claims

An Oklahoma City-based hospice chain has agreed to a $4 million settlement with the federal government over allegations it submitted false Medicare invoices for patients who were not terminally ill.

The Oklahoman reported that government investigators said the Good Shepherd Hospice Inc. pressured employees to meet census and hospice admissions targets, leading to the alleged fraud. Medicare has a hospice benefit that covers terminally ill patients who have six months or less to live. The daily rates a hospice can be paid ranges from about $150 to $895.

Investigators say employees were paid bonuses based on the number of patients enrolled. Medical directors were hired by the hospice, which has affiliates in Kansas, Missouri and Texas, based on their ties to nursing homes, which are a source of referrals. In Kansas, the business has operations in Newton and Wichita.

The settlement comes after two former employees of the affiliate in Kansas City, Mo. helped investigators uncover the alleged fraud. U.S. Attorney Tammy Dickinson of the Western District of Missouri, whose office prosecuted the case said, “In this case, company whistle-blowers alleged that patients received unnecessary hospice care while Good Shepherd engaged in illicit business practices to enrich itself at the public's expense.”

Good Shepherd released a statement denying any wrongdoing and said it cooperated with the government's investigation.

“Despite what the company has always maintained are unfounded accusations by two former employees, the focus of the government's review was not on those accusations, but on the continuing eligibility of a small fraction of patients served during the period from 2006 to 2011,” Good Shepherd wrote. “The decision to resolve this matter was not based on the merit of any assertions against the company; nor has any determination of liability been made.”

The company has agreed to submit to ongoing monitoring by the Department of Health and Human Services’ inspector general as part of the settlement.