Largest For-Profit Hospice Provider Sued by DOJ for Medicare Fraud

Chemed Corporation, the largest for-profit hospice chain in the United States, has been accused of fraudulent Medicare billing for hospice and healthcare services—such as crisis care for a patient who was playing bingo part of the time—the Department of Justice announced on Thursday. 

The government’s complaint alleges that Chemed and Vitas Hospice Services LLC, a wholly-owned subsidiary of Chemed, knowingly submitted or caused the submission of false claims to Medicare for hospice and crisis care services that were either unnecessary, not actually provided, or not performed per Medicare requirements. 

The companies were setting goals to bill a certain number of crisis care days to Medicare, according to the complaint, and used “aggressive” marketing tactics, including pressuring staff, to increase the number of these claims—whether or not the services were appropriate or actually provided.

In one instance, Vitas billed three straight days of crisis care for a patient, even though that patient’s medical records have no indication the patient needed crisis care, the complaint says. During one of those days, the patient’s file indicates participation in a bingo game.

The government also alleges that Chemed and Vitas knowingly submitted false claims for hospice care for patients who were not terminally ill. The companies allegedly paid bonuses to staff based on the number of patients enrolled in the program and based on patients who were admitted for longer lengths of stay, according to the Justice Department. 

Additionally, “adverse employment actions” were taken against marketing representatives who did not meet hospice enrollment quotas. 

These business practices resulted in patients who were ineligible for hospice care being admitted into hospice programs, the complaint alleges. One hospice patient who showed no signs of terminal condition was described in Vitas’ own records as “very healthy given her age,” according to the complaint. 

As a result of this conduct, the government contends that Chemed and Vitas violated the False Claims Act and misspent “tens of millions” of taxpayer dollars from the Medicare program. 

“The Medicare hospice benefit is intended to provide patients nearing the end of life with pain management and other palliative care to make them as comfortable as possible,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “Too often, however, we hear reports of companies that abuse this critical service by using aggressive marketing tactics to push patients into services they don’t need in order to get higher reimbursements from the government.”

Written by Alyssa Gerace