Hospice Care and the Shifting Focus of False Claims Act Enforcement

With an increasingly large population of elder individuals, the demand for hospice services over the past decade has seen a dramatic rise. In fact, between 2003 and 2011, the amount of funding being expended on hospice services nationwide has more than doubled—increasing from $5.9 billion to nearly $14 billion annually.

Unfortunately, with the increased demand for hospice services, there has also been a parallel rise in lawsuits against hospice providers for violations of the federal False Claims Act (“the FCA”). These lawsuits take many forms, but the one that has experienced exponential growth is qui tam lawsuits, largely because an individual relator stands to benefit substantially if the allegations against the provider prove true. Due to the increased liability facing hospice providers, it is now more important than ever that hospice providers ensure compliance with the applicable regulations.

One of the central foci of recent FCA enforcement in the hospice context is individual beneficiary elections. Under applicable Medicare requirements, there are several prerequisites for proper admission to a hospice facility, and failure to comply with any one can result in a violation of the FCA. Another area of concern involves hospice services being provided in a nursing home facility. The primary difficulty in that context relates to the fact that nursing homes retain discretion in choosing which hospice provider they utilize. As a result, recent investigations by the Office of Inspector General have revealed strong enforcement relating to the Anti-Kickback Statutes.

In order to curb potential violations of the FCA, hospice providers must take active steps to ensure that safeguards are in place to avoid noncompliance. Accordingly, hospice providers should engage their staff and educate their entire organizations on the importance of strict compliance with the law. By instilling such a culture throughout the workplace, hospice providers can avoid costly litigation, thereby enabling them to provide the highest quality of care to their patients.

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