Golden Living Accused Of Fraudulent Medicare Practices, DOJ Steps In

The U.S. Department of Justice has joined a 2009 lawsuit filed in Alabama that alleges Plano, Texas-based Golden Living (formerly headquatered in Fort Smith) used fraudulent Medicare practices “for maximum profit.”

Dawn Richardson and Marsha Brown claim in a lawsuit filed in March 2009 that AseraCare — a division of Golden Living — fraudulently pushed patients into and out of nursing home and hospice care operations in order to increase Medicare reimbursements. The five-count lawsuit also alleges that Golden Living and AseraCare officials pressured employees to follow the fraudulent practices.

AseraCare in 2009 operated 65 hospice centers in 19 states. Info from Golden Living notes that AseraCare Hospice provides services for terminally ill patients, including medical care, nursing care, social worker counseling, volunteer services, physical, occupational and speech therapy.

In its press release, the DOJ offered this explanation of the issue: While elderly patients may qualify for a variety of other medical services paid by Medicare, for-profit hospice companies like AseraCare are entitled to receive Medicare dollars only for Medicare recipients who are terminally ill. When a business admits a Medicare recipient to hospice care, that individual is no longer entitled to receive services that would help to cure his or her illness. Instead, the individual receives what is called palliative care, or care that is aimed at relieving pain, symptoms or stress of terminal illness, which includes a comprehensive set of medical, social, psychological, emotional and spiritual services. In this lawsuit, the government contends that AseraCare Hospice knowingly submitted false claims to Medicare for hospice care for patients who were not terminally ill.”

Golden Living attorney David Beck says the allegations are not true and said the DOJ intervention is “troubling.”

“We are disappointed by the Department of Justice’s decision to intervene in the qui tam litigation. This action is especially troubling because we believe it could constrain certain patients — most notably those who suffer from unpredictable disease — from utilizing the hospice benefit. The allegations contained in the complaint are without merit, and AseraCare operates in full compliance with the law,” AseraCare General Counsel David Beck said in a statement issued Jan. 3. (See below for the complete statement from Golden Living.)

Richardson worked 15 years as a hospice caregiver and began in 2002 as an AseraCare nurse. Brown has worked as an executive director since 2003 for several AseraCare hospice sites, and as of March 31, 2009, was the director of an AseraCare facilities in Alabama.

“Since becoming a clinical manager in 2004, Ms. Richardson has become increasingly concerned by intense pressure from corporate management to maintain budgeted enrollment numbers and increase referrals and by implementation of corporate policies designed to avoid Medicare requirements and restrictions by evading regulations,” noted the filing.

The lawsuit, filed by the Birmingham, Ala.-based law firm of Frohsin & Barger, also notes that employees were instructed to “admit non-qualifying patients,” to “dump problem patients” and to “aggressively target imminent-death patients in order to deceptively and fraudulently shrink AseraCare’s average length of stay and average per-patient expenditure …”

Continuing, the filing notes that “Ms. Brown has direct personal knowledge of Defendants’ tactics of fraudulently manipulating the Medicare system for maximum profit by recruiting inappropriate patients for skilled nursing care then referring them to AseraCare hospice once Medicare reimbursements for their skilled nursing and rehabilitative therapy are exhausted.

“Through their experience, Plaintiff-Relators have witnessed so many instances of fraud as to believe that Defendants’ false certifications, fraudulent billing, and tactics of evasion are widespread, systematic practices endemic to the Defendants.”

According to this report at Kaiser Health News, AseraCare recruited patients near death — known as “last breath referrals” — by patrolling hospitals, riding along with Meals-on-Wheels providers and going door-to-door in housing units operated by the Department of Housing and Urban Development.

“Medicare benefits, including the hospice benefits, are intended only for those individuals who are appropriately qualified,” U.S. Attorney Joyce White Vance in Birmingham said in an e-mailed statement.

COMPLETE GOLDEN LIVING STATEMENT
AseraCare Hospice Responds to U.S. Attorney / Department of Justice Filing
PLANO, Texas, January 3, 2012 — AseraCare Hospice issued the following statement in response to a complaint filed today by the U.S. Department of Justice, alleging that AseraCare violated the law by admitting patients the government claims were not terminally ill.

“We are disappointed by the Department of Justice’s decision to intervene in the qui tam litigation. This action is especially troubling because we believe it could constrain certain patients — most notably those who suffer from unpredictable disease — from utilizing the hospice benefit. The allegations contained in the complaint are without merit, and AseraCare operates in full compliance with the law,” said AseraCare General Counsel David Beck.

“Consistent with hospice providers nationwide, AseraCare Hospice has evolved in recent years to treat more terminally ill patients with unpredictable disease progressions,” said AseraCare Hospice President and Chief Medical Officer David
Friend, M.D. “It is simply not possible to precisely predict how patients will respond to challenging illnesses such as end-stage heart, lung and kidney disease, AIDS, and Alzheimer’s.

“Each one of our hospice patients is in our care because two independent physicians have certified his or her eligibility and because the individual has made a decision to focus on care and comfort when a cure is not possible,” said Friend.

“At AseraCare, it is our primary goal to ensure that our hospice patients and their families receive the highest levels of care and comfort and are able to spend their remaining days with dignity.”

Beck added that the Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services, which administers hospice, have repeatedly stated that there is no limit to how long a patient may remain under hospice care as long as the patient’s doctor certifies that a patient is terminally ill and has a six-month prognosis.

Nearly a decade ago, the federal government provided clear guidance that there is no limit on how long an individual may receive hospice care as long as he or she meets these eligibility criteria. In 2000, Nancy-Ann DeParle, as Administrator of the Health Care Financing Administration (predecessor to CMS), wrote, “in no way are hospice beneficiaries restricted to six months of coverage.”

In addition, CMS has expressly recognized that a medical prognostication of life expectancy is not always exact.

Michael Tilley with our content partner, The City Wire, is the author of this report. He can be reached by e-mail at [email protected].