March 20th, 2013
On Wednesday, March 20, 2013, the Department of Justice announced a $12 million dollar settlement with Hospice of Arizona L.C., American Hospice Management LLC and their parent corporation, American Hospice Management Holdings LLC to resolve allegations that they falsely and fraudulently submitted claims to the Medicare program for ineligible hospice services in violation of the federal False Claims Act (Act).
Hospice care is intended for patients who have a life expectancy of six months or less as a result of a terminal illness. Patients admitted to hospice care no longer receive treatment to cure their illness, rather they receive care that focuses on the relief of the pain and stress of their disease. Medicare will cover the costs of such care for its beneficiaries if the patient’s disease has run its normal cost and the patient is expected to live for six months or less.
The federal government through the qui tam case U.S. ex rel. Momeyer v. Hospice of Arizona, L.C. et al. No. 1:10-cv-280 (D. Md.) alleged that between April 1, 2002 and December 31, 2010, Hospice Care of Arizona L.C. and the two related companies submitted claims to Medicare for reimbursement related to the care given to patients who did not need hospice services and billed at a higher reimbursement rate than it was allowed.
The government alleged that Hospice Care of Arizona L.C. and the two related companies pressured the staff to find Medicare eligible patients for admission, that they adopted policies that delayed and discouraged staff from discharging patients who no longer needed hospice care and that they did not have an adequate compliance program to address such issues. American Hospice Management Holdings, L.L.C. has entered into a corporate integrity agreement with the Inspector General of the Department of Health and Human Service that will require the company to establish policies and procedures to avoid and detect similar conduct that is the basis of this settlement.
The whistleblower in this case, Ellen Momeyer, a former Hospice of Arizona L.C. employee, will receive under the provisions of the Act $1.8 million of the government’s recovery for bringing this fraud to its attention.