OIG Medicare Hospice Report Finds Issues Affecting Quality of Care and Program Integrity

Topics: Fraud, Government, Government Fraud, Government Regulation



In a recent report, the Office of Inspector General (OIG) for the Department of Health & Human Services (HHS) identified a number of vulnerabilities in the Medicare Hospice Program that directly impact the quality of patient care and compromise Medicare program integrity.

Medicare Hospice Program

Under the Medicare Hospice Program, beneficiaries forgo curative care for their terminal illnesses and instead receive palliative care, which focuses on the relief of pain and other symptoms, includes psychological and spiritual support, and attempts to improve the quality of life for patients and their families near the end of the beneficiary’s life. Palliative care can be provided in different settings, including the home, nursing facility, hospital, or hospice in-patient unit.

According to the OIG report, Medicare paid $16.7 billion for hospice care in 2016 for 1.4 million beneficiaries receiving hospice care. Medicare spending for hospice care has been steadily increasing over the past decade. In 2006, Medicare paid $9.2 billion for 1 million beneficiaries receiving hospice care. Further, the number of hospices increased 43% to 4,374, from 3,062 over the same period.

Medicare pays for four levels of hospice care, including:

  •        Routine home care for a hospice beneficiary who is home and not receiving continuous home care;
  •        General inpatient care for pain control or symptom management on a short-term basis in a hospice inpatient unit, hospital, or skill nursing facility (SNF);
  •        Continuous home care during brief periods of crisis and only as necessary to maintain the patient at home; and
  •        In-patient respite care for short-term in-patient care for the beneficiary when necessary to provide relief to the caregiver.

Recent Hospice Enforcement Efforts

In recent years, the Department of Justice (DOJ) has brought a number of high-profile enforcement cases against hospice providers:

  • In June 2017, the DOJ announced a $53.6 million settlement with Genesis Healthcare Inc. to settle six federal lawsuits and investigations alleging that companies and facilities Genesis had acquired violated the False Claims Act (FCA) by submitting false claims to government healthcare programs for medically unnecessary therapy and hospice services, as well as for grossly substandard nursing care. The allegations involving hospice services included: i) billing for hospice services for patients who were not terminally ill and therefore not eligible for hospice benefits; and ii) billing inappropriately for certain physician evaluation management services.
  • In July 2017, the DOJ announced a $19.5 million settlement with three Ohio-based companies — Foundations Health Solutions Inc., Olympia Therapy Inc., Tridia Hospice Care Inc. and two executives — to resolve allegations that they submitted false claims to Medicare for medically unnecessary rehabilitation therapy and hospice services. The DOJ alleged Tridia submitted false claims to Medicare for hospice services for patients who were ineligible because Tridia failed to conduct proper certifications or medical examinations.
  • In October 2017, the DOJ announced a $75 million settlement with Chemed Corp. to resolve allegations that Chemed and various wholly-owned subsidiaries, including Vitas Hospice Services LLC and Vitas Healthcare Corp., violated the FCA by submitting false claims to Medicare for hospice services for ineligible patients and at inflated levels of care.
  • In June 2018, the DOJ announced a $8.5 million settlement with Caris Healthcare, LP and Caris Healthcare, LLC to resolve allegations that they violated the FCA by knowingly submitting false claims and knowingly retaining overpayments for the care of beneficiaries who were ineligible for Medicare hospice benefits because they were not terminally ill.

OIG Report Findings

In its study of the Medicare Hospice Program, the OIG found that hospices compromise patient care when they:

  • Do not provide needed services to beneficiaries;
  • Provide poor quality care;
  • Fail to manage symptoms or medications, “leaving beneficiaries in unnecessary pain for many days; and
  • Do not always provide patients and their families with the necessary information to make informed decisions about the care.

Additionally, the OIG found fraud schemes in the Medicare Hospice Program that enrolled beneficiaries in hospice who are not eligible or billed Medicare for hospice services that were never provided.

The OIG has made significant recoveries from hospice providers over the past five years. In FY 2013, the OIG recovered $15.5 million; in FY 2017, it recovered $55.8 million. The total for the five-year period was $143.9 million in investigative receivables.

OIG Recommendations to Improve Quality of Care and Program Integrity

In order to improve the quality of care for Medicare beneficiaries and improve Medicare Hospice Program integrity, the OIG made several recommendations to the Centers for Medicare and Medicaid Services (CMS). Those recommendations include:

  • Strengthen the onsite survey process to ensure hospices provide beneficiaries with needed services and quality care;
  • Seek statutory authority to establish additional remedies for hospices with performance such as “directed plans of correction, directed in-service training, denials of payment for new admissions or for all patients, civil monetary penalties, and imposition of temporary management”;
  • Develop and disseminate reliable information on hospice care providers to help beneficiaries, their families and caregivers make informed choices;
  • Educate beneficiaries, their families and caregivers about the hospice benefit and the goals of hospice care;
  • Promote physician involvement and accountability to ensure that beneficiaries receive appropriate care so that valid eligibility certifications and recertifications are made and that patients receive appropriate care to manage pain and other uncontrolled symptoms;
  • Strengthen CMS oversight of hospices to reduce inappropriate billing; and
  • Take steps to tie payments to beneficiary quality of care to ensure beneficiaries’ care needs are met.

Preventing Fraud, Waste and Abuse

With the steady increase in Medicare Hospice Program costs — an 81% increase from 2006 to 2016 — preventing fraud and abuse in the program and ensuring that beneficiaries, their families and caregivers receive quality care and support at the end of the beneficiaries’ lives is certain to remain an OIG and DOJ enforcement focus.

Implementing the OIG recommendations would almost certainly improve care and reduce unnecessary costs.