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Houston Chronicle Investigates Home Health Fraud, Finds Agencies “Breaking Rules” and “Raking in Medicare Dollars”

December 6, 2011

According to a report in yesterday’s Houston chronicle, “over $1.25 billion” has been paid by Medicare for home health services in just four years in Houston, while “nearly every [home health] agency… has violated state and federal standards.”  The Chronicle’s Terri Langford writes: “Federal authorities say not only are companies falling short on certain standards of care, some also are bastions for potential fraud – its victims patients and taxpayers.

Langford quotes Assistant United States Attorney Justo Mendez as saying that the federal government knows that taxpayer dollars are being lost to ‘”fraudsters’ who “bill for services not rendered.” But determining which companies are cheating and which ones are not and learning the information necessary to bring legal action to recover the money proves to be a monumental if not insurmountable task for authorities to tackle alone. Langford’s report quotes Rachel Hammon, director of clinical practice and regulatory affairs for the Texas Association of Home Care & Hospice, who insinuates that part of the problem is a bureaucratic breakdown. “I think the big problem I see is how the various government agencies coordinate. Each one says ‘That’s not what I do’ or ‘I’m not funded.’ ” says Hammon. The Association’s executive Director, Anita Bradberry agrees, telling Langford, “I have a problem with the government not watching who is billing what.”

The Chronicle’s investigation found the following deeply disturbing facts:

  • “384 million was paid to 468 Houston companies in 2010” alone
  • “Even in the tiny town of Edinburg in South Texas, 27 home health care agencies have received $331 million over the last four years” [FraudBlawg note: At the town’s population of 72,000 — that’s nearly $5,000 of taxpayer dollars for every man, woman, and child in the city]
  • “Medicare’s direct contact with the companies that bill the mammoth insurance agency for the elderly and disabled is minimal.”
  • “No one from the $760-billion CMS ever sets an eyeball on a home health agency in Houston”
  • “Federal auditors repeatedly have noted the exploding and profitable growth of home health care in the Lone Star State, where Medicare spending has blown up to three times the national growth rate.”
  • “Even before Houston’s explosive growth in home health care, federal auditors noted that not only had the number of people getting Medicare benefits doubled, but so did the number of times agencies billed for a visit to a patient: from 36 times to 73.”

The Chronicle story reports shocking instances of elder abuse and other serious problems and follows the story of one Houston man whose mother was put on home health to watch a wound on her foot and who “quickly became alarmed about all the doctors and health aides who were practically falling all over themselves to schedule house calls,” many of whom apparently lied about their credentials — at least one of whom fraudulently claimed to be a doctor.

If the Authorities Aren’t Going to Do Anything, Insiders Must Come Forward

There is one small ray of hope, however.  Like everything else in this country, it is the people who can effect a change.  The federal False Claims Act — enacted by President Abraham Lincoln who was shocked by defense contractor fraud during the Civil War (Texas has a similar state law) — permits people who have direct and independent knowledge of such fraud to file independent lawsuits on behalf of the taxpayers to recover false claims like the widespread practices that are apparently rampant in Houston.  Under the False Claims Act, fraudsters can be forced to repay to the taxpayers up to three times the amount of their false claims plus a civil penalty of up to $11,000 per false claim.  The whistleblower (or relator) who uncovers the fraud can be rewarded with between 15-30% of the total recovery, plus attorneys’ fees and costs of the lawsuit.

To report home health care fraud or other Medicare fraud, contact Frohsin & Barger.

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