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SouthernCare Hospice Pays Near $25 Million in Record Medicare Hospice Fraud Settlement

May 4, 2009

The Huntsville Times reports that national Medicare Hospice provider SouthernCare agreed to pay $24.7 million to settle allegations that it fraudulently admitted nonqualifying patients to its Hospice program and submitted false claims for payment to Medicare.  The Times quoted whistleblower attorney Henry Frohsin as saying, “This was a case of corporate excess and greed over many years that was driven not by care for the patient, but driven by number and payments from the taxpayers.”

According to the Complaint filed by Frohsin & Barger on behalf of a nurse and former employee of SouthernCare,  the company submitted Medicare billing for and provided in-home hospice services for patients who continued to live for years.  The Huntsville Times reports:

‘Many of them were not in the last stages of their lives,’ said Frohsin, calling it the largest hospice fraud case in U.S. history.
Founded in 1995, SouthernCare maintains its headquarters in Birmingham and operates 95 sites in 15 states. The company is most active in Alabama where it provides care from 27 offices, including one in Huntsville on South Memorial Parkway.

The local office referred all questions to a corporate spokesperson, who supplied a written response late Thursday.

‘Importantly, the dispute was wholly unrelated to the quality of hospice care provided by SouthernCare,’ reads the company statement, ‘but rather, dealt with the criteria for determining when a patient is eligible to receive hospice services under Medicare rules.’

To qualify for Medicare benefits for hospice care, patients must be diagnosed with a life expectancy of six months or less. Federal investigators argued that SouthernCare submitted claims for patients who were not terminally ill and did not require in-home hospice care, which can include everything from sponge baths to spiritual counseling to pain pills.

But according to SouthernCare, it’s not always easy to tell who qualifies. The company argues in its statement that ‘accurately predicting life expectancy is an inexact science.’

According to the Department of Justice, the hefty payout resulted from claims filed by two former caseworkers in Birmingham. Their lawsuits were kept sealed as the federal government investigated the charges.

‘Our investigation showed a pattern and practice to falsely admit patients to hospice care who did not qualify and to bill Medicare for that care,’ said Alice H. Martin, U.S. Attorney for the Northern District of Alabama. ‘This resulted in taxpayers bearing inappropriate costs.’

To report Medicare Hospice fraud, contact Frohsin & Barger.

12 Comments
  1. Sherrie Upton permalink

    I find this strange. My dads been in hospice for over 2 years continually for the past 10 months. The changes that we are seeing thru this company are harsh and stressful on my dad. I am a single mom caregiver for my dad and deal with this company on a daily basis. The employees are amazing people but this jerking around from cooperate is very disheartening. We were robbed of over 9k cash that a direct contact from Southern Care referred me to to assist getting out Christmas Decorations out and some odd and ends jobs. I contacted cooperate. Nothing was done. Now we have had our aide of 8 months pulled and our nurse that knows all my dads quirks and needs. Today I was surprised when I answered the door to a new nurse that doesn’t have a clue about my dad. I want to change companies. But he doesn’t like change. Sad thing is he’s not understanding they are changing things underneath him with no regard for his feelings or needs in his final days if life with us. This is way too far fetched to wrap my mind around. He’s put me in charge of his health. And I am regretting that I have stayed with this company as long as we have this articial even disturbs me more. I can’t work for he can’t be left alone and loosing money along with all my dads tools and thigs from his home by hospice is very sad and cooperate didn’t have the decency to call me back after investigating. Very disappointed in this company

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