Mccarter &ENGLISH

McCARTER &ENGLISH ATTORNEYS AT LAW BOSTO N | HARTFORD | STAMFORD | NEW YORK | NEWARK www.mccarter.com EAST BRUNSWICK | PHILADELPHIA | WILMINGTON | WASHIN GTON, DC Hospice Care in the Crosshairs: The Growing Fraud and Abuse Enforcement Threat to Hospice Providers Justin C. Linder, Esq. 1 * Originally published in Health Lawyers Weekly , a publication of the American Health Lawyers Association Introduction Authorized in 1982, the Medicare hospice benefit has grown steadily and, with that growth, has attracted ever-increasing fraud and abuse scrutiny and enforcement. Now more than half of individuals who die while covered by Medicare use the benefit before death. 2 From 2003 to 2011, the number of Medicare beneficiaries receiving hospice care has risen from 729,000 3 to 1.2 million individuals 4. Over the same period, Medicare payments for hospice care more than doubled, climbing from $5.9 5 to $13.7 billion 6. As Medicare expenditures for hospice care continue to soar, the federal government has assumed an increasingly active role in combating perceived problems of hospice fraud. The Department of Health & Human Services Office of Inspector General and the Department of Justice contend that many hospice providers have pursued a variety of illicit schemes to improperly obtain hospice benefit payments. False Claims Act lawsuits alleging hospice fraud are increasing both in frequency and amount in controversy, resulting in recent settlements of up to $25 million. This trend shows no sign of slowing. This past May the Department of Justice grabbed headlines when it intervened in a whistleblower lawsuit against VITAS, the largest for-profit hospice chain in the country. Relators’ counsel have taken notice of recent legal developments and a simple internet search for “hospice whistleblowers” now turns up numerous websites actively recruiting hospice employees for potential whistleblower suits. A press release from Corporate Whistleblower Center, for example, 1 Mr. Linder is an attorney with the Newark, NJ office of McCarter & English, LLP. 2 David G. Stevenson, Growing Pains for the Medicare Hospice Benefit , 367 New Eng. J. Med. 1863 (Nov. 1, 2012). 3 OIG, Memorandum Report: Questionable Billing for Physician Services for Hospice Beneficiaries , OEI-02-06-00224 (Sept. 22, 2010). 4 OIG, Memorandum Report: Medicare Hospice: Use of General Inpatient Care , OEI-02-10-00490, p. 2 (May 3, 2013). 5 Medicare Payment Advisory Committee, Report to the Congress: New Approaches in Medicare , p. 140 (June 2004). 6 OIG, Memorandum Report: Medicare Hospice: Use of General Inpatient Care , OEI-02-10-00490, p. 2 (May 3, 2013). McCARTER & ENGLISH, LLP McCARTER &ENGLISH ATTORNEYS AT LAW BOSTON | HARTFORD | STAMFORD | NEW YORK | NEWARK www.mccarter.com EAST BRUNSWICK | PHILADELPHIA | WILMINGTON | WA SHIN GT ON, DC encourages hospice employees to contact them directly “for information about possible reward programs” and warns against engaging their employers regarding perceived fraud, advising that “any suggestion of exposure might result in instant job termination . .”. 7 Penalties for erroneous hospice claims are severe, including treble damages and civil penalties between $5,500 and $11,000 for each False Claims Act violation. To avoid the risk of costly litigation and crippling fines, hospice providers should carefully monitor their compliance with Medicare requirements. This article provides an overview of Medicare conditions of participation, major risk areas for noncompliance, and recent legal actions involving hospice providers to help guide decision-makers in crafting effective compliance programs. Conditions of Eligibility & Participation The objective of hospice care is to assist terminally ill beneficiaries to live comfortably and provide support to caregivers and families throughout the end stage of a terminal disease. In support of these goals, coverage under the Medicare hospice benefit includes nursing care, physical or occupational therapy, speech-language pathology, medical social services, home health aide services, homemaker services, medical supplies (including drugs and biologicals) and the use of medical appliances for palliative care, physicians' services, short-term inpatient care, and counseling. Medicare Part A beneficiaries diagnosed with a terminal illness and a life expectancy of six months or less may elect to receive hospice benefits in lieu of standard Medicare coverage for treatment of the underlying terminal condition. In making such election, the beneficiary must agree to forego curative care in favor of palliative care to manage pain and symptoms. A hospice care beneficiary waives all rights to Medicare Part B payments for services related to the treatment and management of the underlying terminal illness or a related illness for any period of time in which the hospice benefit election is in force,8 but a beneficiary may revoke his or her election and return to standard Medicare coverage at any time. 9 Throughout the hospice election period, Medicare continues to cover services provided by the patient’s attending physician, which may include a nurse practitioner. Hospices provide and oversee services rendered to a beneficiary through an interdisciplinary group (IDG) comprising a physician and other professionals responsible for various aspects of care. 7 “The Corporate Whistleblower Center Urges All Hospice Insiders with Proof of Medicare Billing Fraud to Contact Them Immediately for Compensation Info,” http://www.prweb.com/releases/2013/9/prweb11095725.htm (last visited on Dec. 4, 2103). 8 42 U.S.C. §§ 1395d(d)(2)(A), 1395x(dd)(1); 42 C.F.R. § 418.24. 9 42 U.S.C. 1395d(d)(2)(B); 42 C.F.R. § 418.28. McCARTER & ENGLISH, LLP | PAGE 2 McCARTER &ENGLISH ATTORNEYS AT LAW BOSTON | HARTFORD | STAMFORD | NEW YORK | NEWARK www.mccarter.com EAST BRUNSWICK | PHILADELPHIA | WILMINGTON | WA SHIN GT ON, DC Hospice care may be provided to beneficiaries and their families in a variety of settings, including the home or a nursing facility. Hospice benefits are allotted in terms of coverage periods. Beneficiaries receive coverage for two 90-day periods, followed by an unlimited number of 60 day periods. Prior to submitting a hospice benefit claim to Medicare, a provider must ensure that each of the following conditions are satisfied: • The hospice is certified by Medicare.10 • The patient is entitled to Medicare Part A benefits. 11 • The beneficiary is diagnosed with a terminal illness, defined as a life expectancy of 6 months or less if the illness runs its normal course. 12 o At initiation of treatment, the beneficiary’s terminal prognosis must be certified by the patient’s attending physician (if there is one), and the hospice’s medical director (or the physician member of the hospice’s IDG). 13 o At the start of each subsequent 90 or 60 day period of hospice care, the hospice medical director or physician member of the IDG must recertify that the beneficiary is terminally ill and has a life expectancy of 6 months or less. 14 o A brief narrative of the clinical findings that support a life expectancy prognosis of 6 months or less must be provided as part of each certification and recertification.15 o Effective January 1, 2011, a hospice physician or nurse practitioner must conduct a face-to-face encounter with each beneficiary prior to the 180th day recertification of terminal illness, and each subsequent recertification, to determine continued eligibility, and must attest that such visit occurred. 16 10 42 U.S.C. §§ 1395f(a), 1395cc; 42 C.F.R. § 418.116(a) 11 42 C.F.R. § 418.20. 12 42 C.F.R. §§ 418.3, 418.20, 418.22. 13 42 C.F.R. 418.22(c). 14 42 C.F.R. § 418.22(a)(1), (c). 15 42 C.F.R. § 418.22(b)(3). 16 42 C.F.R. § 418.22. McCARTER & ENGLISH, LLP | PAGE 3 McCARTER &ENGLISH ATTORNEYS AT LAW BOSTON | HARTFORD | STAMFORD | NEW YORK | NEWARK www.mccarter.com EAST BRUNSWICK | PHILADELPHIA | WILMINGTON | WA SHIN GT ON, DC • The patient must elect in writing to receive hospice care and waive curative care coverage during the hospice coverage period. The election statement must acknowledge that the patient was given a full understanding of hospice care and comprehends that certain Medicare services are waived by the election. 17 • The hospice must designate one or more IDGs to meet the physical, medical, psychosocial, emotional, and spiritual needs of the patient and family. At minimum, an IDG must include: a medical doctor or osteopath employed by or under contract with the hospice, a registered nurse, a social worker, and a pastoral or other counselor. 18 • All hospice care and services furnished must follow an individualized written plan of care established by the IDG in collaboration with the beneficiary’s attending physician (if any), the patient, and the primary caregiver. The IDG, in collaboration with the patient’s attending physician (if any) must review, revise and document the plan of care as frequently as the patient’s condition requires, but no less than every 15 days. 19 • Hospice services must be reasonable and necessary for the palliation or management of the terminal illness and related conditions. 20 Failure to comply with any one of these requirements may result in serious adverse consequences to a hospice provider. Services that are improperly documented or rendered in a non-compliant manner are not recoverable from Medicare and billing Medicare for such services is considered a violation of the FCA. A provider further may be liable for FCA violations if it becomes aware that it has received payment from Medicare for noncompliant or improperly documented services and fails to notify the government and return any overpayments. As detailed below, certain conduct may be perceived as violative of state or federal anti-kickback laws. Levels of Care The Medicare hospice benefit includes the following four levels of care: 21 • Routine Home Care , the least expensive level of care, includes routine services provided to the hospice patient in the patient’s home or a facility in which the patient resides.

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