Home Health & Hospice Week

Hospice chain shells out $13 million to settle fraud charges related to terminal illness.

If your employees don't feel like you're listening closely to their fraud concerns, you could wind up squarely in the feds' crosshairs--and that can be a very expensive place.

For-profit hospice chain Odyssey HealthCare Inc. has learned that lesson the hard way. The Dallas-based company has paid $13 million to the government to settle False Claims Act allegations, it says in a release. Odyssey also has entered into a corporate in-tegrity agreement (CIA) with the HHS Office of Inspector General.

The company admitted no wrongdoing in the settlement, which it first announced back in February (see Eli's HCW, Vol. XV, No. 8).

Federal prosecutors alleged that Odyssey billed Medicare for services provided to hospice patients who were not terminally ill and therefore were ineligible for the Medicare hospice benefit, the U.S. Department of Justice says in a release.

The settlement resolves charges originally brought against Odyssey by former regional vice president JoAnne Russell, the DOJ notes. Odyssey hired Russell in 2002 as director of patient care services for its Milwaukee program, Russell's attorney, Nola Hitch-cock Cross, told the Milwaukee Journal Sentinel. A year later, Odyssey promoted Russell to a position auditing Medicare compliance for a multistate region.

When Russell's audits turned up problems in certifications and recertifications, "she would recommend discharge of these patients who did not meet the criteria and was responded to unfavorably by Odyssey," according to her whistleblower lawsuit filed in 2003. Russell eventually was fired.

Russell will receive more than $2.3 million of the settlement, which covers Odyssey claims from 2001 to 2005, the DOJ notes.

"Now Odyssey has had a wake-up call, their CEO stepped down and they are under a corporate compliance agreement, so it was worth it," Russell told the Journal Sentinel. "I would do it again even if I had not received any money on the Odyssey claim." 6 Steps To Protect Against Whistleblowers Heads up: The settlement shows the government is taking hospice fraud seriously, warns attorney Deborah Randall with Arent Fox in Washington, DC.

And terminal illness has always been a fraud risk area for hospices, notes Burtonsville, MD-based health care attorney Elizabeth Hogue. "This is one of the never-ending stories in the hospice industry," Hogue tells Eli. Hospices may be even more at risk because they "have generally let down their guard on this issue a little bit in the past year or so."

Consider these steps to keep in compliance and out of court for whistleblower lawsuits: 1. Scrutinize terminal illness. This settlement reinforces that determinations of terminal illness should "remain at the top of hospice managers' lists," Hogue urges. As part of its CIA with the OIG, Odyssey is implementing a "first-of-its [...]