Home Health & Hospice Week

Hospital-based home health agencies might want to make sure their parent organizations are claiming them fair and square on their Medicare cost reports or risk costly whistleblower lawsuits.

Fort Collins, CO-based Poudre Valley Health System learned that lesson the hard way, agreeing to pay $2.9 million to settle a qui tam suit alleging that Poudre Valley Hospital falsely certified on Medicare cost reports that it didn't conduct business with companies related to it by ownership or control.

In this case, it was the former HHA director who caused the suit. According to whistleblower Lee Burkholder, despite its certification, Poudre Valley in fact inappropriately billed for home health services provided by a not-for-profit subsidiary, Poudre Care Connection.

PVHS officials counter that ex-PVHS employee Burkholder never even gave them a chance to fix the problem. PVHS Compliance Officer Rich Cohan says Burkholder didn't raise any issues when interviewed by compliance staff, and failed to take advantage of existing compliance reporting mechanisms.

PVHS President and CEO Rulon Stacey says if they'd been told about the problems, they would have come forward on their own - without the need for a whistleblower suit. The health system already has a track record on this front: In 2002, it voluntarily disclosed problems with certain teaching physician claims and ultimately settled with the government for about $950,000.

"We've taken pride in the fact that we're one of a limited number of health care providers in the nation that has voluntarily stepped up and admitted that we made a mistake," Stacey says. "We would have done the same in the home health case if Lee Burkholder ... offered information about irregularities that he knew may have existed."