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"We've got to corner the market", Mary Labyak, executive director of The Hospice of Florida Suncoast told hospice employees at one of her monthly meetings.
She was talking about the death market.
Christina Brundage, a registered nurse employed by The Hospice of Florida Suncoast from 1995 until 2000, said that comment uttered by Labyak after a federal audit of the Hospice in 1995 was a turning point for her.
"It was like the old hospice was long gone. When I first went there, they were very supportive of the nurses. It was a very good working atmosphere at first and then things began to change. This was a whole new thing. The focus was different after that. I was happy to leave, I took early retirement".
Labyak is the president of the corporation which owns Woodside Hospice where the late Terri Schindler-Schiavo resided for the last five years of her life although hospice eligibility rules
require that a patient must be terminal with a life expectancy of six months or less to be admitted.
Terri Schindler-Schiavo was handicapped. She was not terminal.
In 1980, Labyak became program director of Hospice of the Florida Suncoast and has been president and executive director of the corporation since 1983. According to corporate filings with the state, the hospice program employs approximately 1,000 people, has more than 3,000 volunteers and an average daily census of more than 1,800 patients. It touts itself as having become a natural resource center for end-of-life issues.
Labyak has been associated with the Hospice of the Florida Suncoast since 1977 when she began as a volunteer on behalf of dying people, according to financial reports for the hospice filed with the state that show revenues for 2003 of over $81 million with assets of more than $47 million.
The Hospice of Florida Suncoast is the subject of a collection action totaling $14.8 million by the U.S. Department of Health and Human Services as the result of a federal audit in 1995 which determined that the hospice under CEO Labyak had been admitting ineligible people to the hospice and unlawfully billing the federal government for their care under Medicare. The federal government has been trying to recover the Medicare overpayments made to the hospice since May, 1997 at the time when George Felos (right), attorney for Michael Schiavo (left), was chairman of the hospice board.
Michael Bell, hospice spokesman and vice president, was recently quoted as saying the matter had been resolved but the 2004 annual report of HHS, issued Dec. 31, 2004, indicates that the collection action for nearly $15 million against the hospice organization is still active.
"At the time of the HHS audit, the hospice went berserk", Brundage said. "They are so image conscious. All kinds of things were coming down from the main office, from Labyak. There were articles in the newspapers about it. They called us all together and said we were cleared of any wrongdoing and told us to go tell your patients that".
"But we found out later we weren't cleared. That made me mad because I was lying to my patients without knowing, they were using us. After that they became real paranoid about admitting patients improperly".
Not only was Terri Schiavo never properly certified as required by law for entry into the Woodside Hospice where she remained for five years, but a review of the records and circumstances indicates that there may have been many egregious violations of federal Hospice Law as well as state and federal Medicaid and Medicare regulations by Hospice of Florida Suncoast under the leadership of Labyak as CEO and Martha Lenderman, also a former chairperson and current board member. Regulations require that the hospice, and James Avery, would have had to recertify every six months that Terri Schiavo was terminally ill in order to be eligible for Medicare.
Schiavo, the brain damaged woman who died March 31 as the result of starvation and dehydration due the court ordered removal of her feeding tube as petitioned by her estranged husband, Michael Schiavo, had been moved to the hospice in April, 2000, by Schiavo, and his attorney, George Felos.
Felos was a member of the hospice board of directors at the time of the move and a past chairman and associate of Labyak.
Felos failed to disclose his position as chairman of the Hospice board to the opposing party in the guardianship case, the Schindlers, then resigning in 2001 amid public pressure and scrutiny after he and Terri Schiavo's estranged husband had surreptitiously moved Terri to the facility without court authorization in April, 2000, reportedly as a result of arrangements made by Felos. By moving her to a facility where Felos was chairman of the board, all of Terri's caregivers including her doctors and the hospice medical director were presumably under the total control of Felos and his client----but it appears that Felos knew, or should have known, that the proper certification had not been completed and that she was not eligible for hospice care.
It also appears that Labyak and Lenderman should have known of the ineligibility of Terri Schiavo and the improper certification filed as well as the Hospice's new senior medical director at the time, Dr. James Avery.
In fact, according to the hospice law, Terri Schiavo should have been cared for in her home----or that of her parents, Mary and Robert Schindler Sr., who battled for nearly 10 years to take her home.
Brundage was employed by the hospice in the home care program and after learning of the Schiavo case, helped to create the original www.terrisfight.org website and worked tirelessly as a volunteer for the Terri Schindler-Schiavo Foundation to provide news and information concerning the contentious battle to save Terri's life.
She left the hospice in February, 2000, prior to Terri's admission to Woodside and prior to the arrival of Dr. Avery as senior medical director for hospice.
She said that after the HHS investigation, there were different guidelines at the hospice for different diagnoses. Brundage said Hospice didn't want to get patients in there too early.
But they improperly certified that Terri Schiavo was terminal, having less than six months to live, and kept her there for five years.
"Between the Medicare investigation and 2000 when I left, they really got tight about admitting people and that's when Felos was on the board so he had to know that Terri was being admitted illegally", Brundage said. "Dr. Victor Gambone, Terri's doctor at the hospice, had testified that Terri wasn't terminal. The whole thing was like Alice in Wonderland. After I left the hospice, I went through the medical charts for Terri. They were very bizarre. Anything controversial, the hospice jumped in and controlled everything. The whole atmosphere was incredible control.
"It was a very good working atmosphere at first and then it began totally to change. Mary Labyak would have these monthly meetings, we'd all have to go to Largo and listen to her visions for hospice, like a 'don't we all love hospice' meeting, a pep rally. When I heard her say, "we've got to corner the market", that really hit me. It was a turning point---she's one tough woman.
"They were working on all these ways to get more patients in that weren't terminal, they were going to have all these new programs-a palliative care program, a home health program. . When I first started there, everything was patient oriented and I really appreciate that as a nurse---like they were trying to bring in more and more people and fought so hard to keep any competition out. It became money oriented rather than patient oriented".
"We did a lot for people but there was a side the people didn't see, like the donation envelopes. When a patient was near death, we always tried to be there for the family. They told us that after the patient dies, when the family is still there, try to get the family to donate, put a check in these envelopes and I refused.
"A lot of these people gave. I met a woman whose husband was deliberately starved to death at Woodside, just as Terri was, even though his Living Will said he wanted everything done to prolong his life so he could be with his family. I tried to get the family to talk about it but sadly, the children of the widow don't want her to report it or even talk to me about it. The children were terrified that hospice would come after them. Their father was murdered---just like Terri---and they were afraid to speak up.
"I think the public assumes that the hospice had to do what they did" Brundage says in speaking of Terri's case. "They did not have to do this".
"All these nurses, except for two or three went along with everything they were told to do. There was an air of intimidation, of fear. The Terri stuff was in all the papers, there was nothing private in the form of ethics. I would mention to a friend of mine, another nurse, about the case and she would get terribly upset, said they were told they could not talk about it even among themselves, anywhere, anytime. These nurses didn't even work there at Woodside. It was orders from hospice, they said.
"You couldn't think about the moral aspect of this, we weren't violating patient confidentiality, it's in the newspapers. That's something that's out there. Even privately between the two of us, she was afraid of hospice, like Big Brother was watching us and that's the kind of feeling there was there, it was a loyalty thing, keep your mouth shut.
"I had a patient who was dying of melanoma, she wanted to do a website to tell people about it, to warn them of the dangers and I helped her do it. After she died, the family asked me to place a notice on the website to tell her friends of her death. I got called into the office, apparently it had come down from the head office that my name was in the public and who was I to do this without permission. That's how controlling they are. It's a strange atmosphere".
"I worked for The Hospice of Florida Suncoast from 1995 to 2000, leaving just a couple of months before Terri was admitted. I did not work at Woodside, however, but on one of the home teams. I was familiar with Woodside though because I often had patients moved there when they were too sick to stay at home and had no one to care for them.
"When I was there, there was no sign of euthanasia, but I always thought it would come to that eventually because the upper management was all New Age, pro-homosexual, actually promoting it, not just accepting it, and there began to be talk of "keeping open a dialogue" with those who were pro-euthanasia.
"There was an atmosphere in Hospice I had never experienced in other places I had worked-as if it was a cult. No one could speak to the media, even if promoting Hospice, without it being cleared by the main office. The New Age outlook was enforced, it was strongly suggested that we give lots of volunteer time on weekends and evenings after working hours.
"As far as Terri's situation, I only know what any of us in the group working with the Schindler family knew. But I did review the Hospice charts for Pat Anderson when she was the attorney. Pat had mentioned some of the suspicious charting by the staff. Having been a nurse so long, I know what charting using looks like and Terri's wasn't the usual.
PATTERNS IN CHARTING AT HOSPICE, 2000-2002
1. Several months after admission, patient (pt) being cared for by a limited group of staff members unlike the usual variety of staff members which would be expected.
2. Charting, at same time as above, begins to be primarily confined to one of the above staff members, rather than occasional charting by other shifts.
3. Some days no charting at all - oversight? or are those days when selected staff members off?
[Some verification of 2 and 3 could be checked by matching days' charting with med sheets - if pt. is getting pm medication, it should be charted by whatever staff member administers it.]
4. The same 3 statements frequently appear, often together - 1) Family is offered emotional support, refuses, says "everything is just fine". 2) Husband is open to support, grateful to staff. 3) Pt. is in PVS.
5. Elaborate charting of what pt. can't do.
6. Only 1 instance noted of pt. being taken outside of room. (Not all entries read, however.)
7. Exaggerated concern for charting obtaining guardian's permission for everything, even something as automatic as permission to evacuate pt. in case of some type of emergency (presumably, flooding, fire, etc.)
8. Charting pt.'s visiting priest going into the room of another pt., a crying child, to comfort him and being told he was not to do that. If that needed to be charted at all, it should be in the child's chart.
9. Charting is very "scripted."
Brundage attended the trial in the guardianship case in November, 2002, before Sixth Circuit Court Judge George W. Greer when, on the basis of 3 doctors to 2, Greer determined that Terri Schiavo was in a persistent vegetative state and would never recover, thereby ordering her death by starvation. He had never seen the patient himself and although videos were shown in the courtroom of Terri, Greer is legally blind.
"Issues are complicated to people without principles", Brundage said. "If you stand on little points of the law, this might be complicated. If you're a human being, it was simple. You either kill her or you don't kill her. It was clear".
Shortly after Brundage took early retirement and left the employ of The Hospice of Florida Suncoast, a new senior medical director was hired, Dr. James A. Avery.
Avery had been in private practice in Clearwater for 14 years doing internal medicine, pulmonary care and critical care until 2000 when he closed his practice and began serving full time as senior medical director for Hospice where he remained until the end of 2003.
In January, 2004, he became the senior medical director of Visiting Nurse Service of New York and in December, 2004, Avery joined AseraCare as national medical advisor.
AseraCare is a subsidiary of Beverly Enterprises. Beverly and its operating subsidiaries are leading providers of health care services to the elderly in the United States.
Beverly has operations in 23 states and the District of Columbia. Beverly currently operates 347 skilled nursing facilities as well as 18 assisted living centers, and 56 hospice and home care centers. Through Aegis Therapies, Beverly also offers rehabilitative services on a contract basis to facilities operated to other care providers.
As the result of an investigation conducted by the U.S. Department of Justice, Beverly Enterprises was found guilty of defrauding Medicare and Medicaid of $460 million. Beverly's CEO William Floyd received $1.288 million in salary in 2001 plus stock options worth $2.3 million more at the same time Beverly was paying back $77.5 million in 2001 and $175 million for a 2001 settlement to resolve charges that the company defrauded Medicare of $460 million.
Avery has left Hospice of Florida Suncoast, caught defrauding the government and its taxpayers of $14.8 million, and become the medical director of a national entity which has been charged with defrauding the government of $460 million.
And although he knew personally that Terri Schiavo wasn't PVS, could swallow and possibly be feed orally and was certainly not terminal, he apparently took no steps as the hospice senior medical director to save Terri's life after he filed his Feb. 21, 2000, affidavit with Judge Greer.
According to filings with the U.S. Security and Exchange Commission, the father of Florida's Gov. Jeb Bush and President George W. Bush, is a major stockholder in Beverly and its subsidiaries and perhaps these holdings may have played a major role in the Terri Schiavo case, perhaps explaining why the U.S. Department of Justice allegedly failed to become involved in the case despite egregious violations of the Americans With Disabilities Act and civil rights violations.
Records indicate that former President George H.W. Bush owned stock in Beverly and health care related corporations including hospice care from 2001 (at the time of the Beverly Medicare fraud) through at least 2003. A list of his stock holdings include:
Sample listing
George H.W.Bush S-4
Business Combination Transaction Registration Statement AEGIS THERAPIES INC
AGI Camelot Inc.
Arborland Management
Associated Physical Therapy Practitioners Inc.
Proxy Statement DEF 14A Avatex Corp.
Beverly Assisted Living Inc.
Beverly Bella Vista Holding Inc.
Beverly Branson Holdings Inc.
Beverly Clinical Inc.
Beverly Enterprises Alabama Inc.
Beverly Enterprises Arizona Inc.
Beverly Enterprises Arkansas Inc.
Beverly Enterprises California Inc.
Beverly Enterprises Colorado Inc.
Beverly Enterprises Connecticut Inc.
Beverly Enterprises Delaware Inc.
Beverly Enterprises Distribution Services Inc.
Beverly Enterprises District of Columbia
Beverly Enterprises Florida Inc.
Beverly Enterprises Garden Terrace Inc.
Beverly Enterprises Georgia Inc.
Beverly Enterprises Hawaii Inc.
Beverly Enterprises Idaho Inc.
Beverly Enterprises Illinois Inc.
Beverly Enterprises Inc.
Beverly Enterprises Indiana Inc.
Beverly Enterprises International Inc.
Beverly Enterprises Kansas Inc.
Beverly Enterprises Kentucky Inc.
Beverly Enterprises Louisiana Inc.
Beverly Enterprises Maine. Inc.
Beverly Enterprises Maryland Inc.
Beverly Enterprises Massachusetts Inc.
Beverly Enterprises Michigan Inc.
Beverly Enterprises Minnesota Inc.
Beverly Enterprises Mississippi Inc.
Beverly Enterprises Missouri Inc.
Beverly Enterprises Montana Inc.
Beverly Enterprises Nebraska Inc.
Beverly Enterprises Nevada Inc.
Beverly Enterprises New Hampshire Inc.
Beverly Enterprises New Jersey Inc.
Beverly Enterprises New Mexico Inc.
Beverly Enterprises North Carolina Inc.
Beverly Enterprises North Dakota Inc.
Beverly Enterprises Ohio Inc.
Beverly Enterprises Oklahoma Inc.
Beverly Enterprises Oregon Inc.
Beverly Enterprises Pennsylvania Inc.
Beverly Enterprises Rhode Island Inc.
Beverly Enterprises South Carolina Inc.
Beverly Enterprises Tennessee Inc.
Beverly Enterprises Texas Inc.
Beverly Enterprises Utah Inc.
Beverly Enterprises Vermont Inc.
Beverly Enterprises Virginia Inc.
Beverly Enterprises Washington Inc.
Beverly Enterprises West Virginia Inc.
Beverly Enterprises Wisconsin Inc.
Beverly Enterprises Wyoming Inc.
Beverly Health & Rehabilitation Services
Beverly Health Care Acquisition Inc.
Beverly Health Care California Inc.
Beverly Health Care LLC
Beverly Holdings Inc.
Beverly Indemnity Ltd.
Beverly Indianapolis LLC
Beverly Manor Inc. of Hawaii
Beverly Missouri Valley Holding Inc.
Beverly Plant City Holdings Inc.
Beverly Rapid City Holding Inc.
Beverly Real Estate Holdings Inc.
Beverly Savanna Cay Manor Inc.
Beverly Tamarac Holdings Inc.
Beverly Tampa Holdings Inc.
10-K Annual Report Calpine Corp.
S-4 Carrollton Physical Therapy Clinic Inc.
Commercial Management Inc.
Community Care Inc.
Compassion & Personal Care Services Inc.
CSG Systems International Inc.
Eastern Home Health Supply & Equipment Co. Inc.
Edison Mission Energy
Greenville Rehabilitation Services Inc.
Hallmark Convalescent Homes Inc.
Home Health & Rehabilitation Services Inc.
Homecare Preferred Choice Inc.
Hospice of Eastern Carolina Inc.
Hospice Preferred Choice Inc.
HTHC Holdings Inc.
Las Colinas Physical Therapy Center Inc.
Liberty Nursing Homes Inc.
Matrix Occupational Health Inc.
Matrix Rehabilitation Delaware Inc.
Matrix Rehabilitation Georgia Inc.
Matrix Rehabilitation Inc.
Matrix Rehabilitation Maryland Inc.
Matrix Rehabilitation Ohio Inc.
Matrix Rehabilitation South Carolina Inc.
Matrix Rehabilitation Texas Inc.
Matrix Rehabilitation Washington Inc.
Medical Arts Health Facility of Lawrenceville Inc.
Midwest Generation LLC
Mirant Mid Atlantic LLC
Moderncare of Lumberton Inc.
Nebraska City S-C-H Inc
Network for Physical Therapy Inc.
North Dallas Physical Therapy Associates Inc.
Nursing Home Operators Inc.
Parks Physical Therapy and Work Hardening Center Inc.
Petersen Health Care Inc.
PT Net Colorado Inc.
PT Net Inc.
Rehabilitation Associates of Lafayette Inc.
Reliant Energy Maryland Holdings Inc.
Reliant Energy Mid Atlantic Power Holdings LLC
Reliant Energy Mid Atlantic Power Services Inc.
Reliant Energy New Jersey Holdings Inc.
Reliant Energy Northeast Management Co.
Reliant Resources Inc. S-1/A
Reliant Resources Inc. S-1/A
Reliant Resources Inc. S-1/A
S-4 South Alabama Nursing Home Inc.
South Dakota Beverly Enterprises Inc.
Spectra Healthcare Alliance Inc.
Tar Heel Infusion Co. Inc.
Theraphysics Corp.
Theraphysics of New York IPA Inc.
Theraphysics Partners of Colorado Inc.
Theraphysics Partners of Texas Inc.
Theraphysics Partners of Western Pennsylvania
TMD Disposition Co.
DEF 14A Trinity Industries Inc.
S-4 Vantage Healthcare Corp.
Reliant Reso
Formerly Beverly Home Care, AseraCare Hospice and Home Health is a leading provider of eldercare services in the United State. With 44 locations in 14 states, Asera Care is the sixth-largest hospice company in the U.S.
Beverly is a publicly traded company, listed on the New York Stock Exchange under the trading symbol BEV.
Shortly after becoming senior medical director at The Hospice of Florida Suncoast in February, 2000, Avery gave a sworn statement to the court and Judge Greer in support of the Schindler quest to keep their daughter alive, saying that Terri was not PVS.
Despite Avery's position at the hospice, Greer ignored him. Shortly thereafter, in April, 2000, with George Felos as a member of the Hospice board of directors and therefore in essence, Avery's boss, Terri Schiavo was admitted as a patient to Woodside House Hospice, certified terminal and the certification improperly completed.
William Moore, medical director at Woodside, and also directly answerable to Felos, had signed the certification----presumably under the direction and supervision of Avery only months after Avery had sworn under oath she was not PVS and that there was a strong possibility that she could take food on her own. Dr. Victor Gambone, Terri's personal physician at that time, failed to sign the certification. The Hospice admitted Terri to Woodside although she was not terminal and the certification had not been signed by two physicians as required.
In his Feb. 21, 2000, affidavit submitted to the court, Avery said that he had accompanied Mary and Robert Schindler to visit their daughter on Feb. 13, 2000, at the Palm Gardens Nursing Home in Largo. He said he had observed her interaction with her parents for a period of 30 minutes. No physical examination was performed.
Avery's statement came after Greer had issued his decision and order that Terri Schiavo must die by removal of her feeding tube and his ruling that not efforts could be made to give her sustenance orally.
"She seemed to respond to her mother's touch and verbal stimuli", Avery said. He said there were responses of three distinct types---turning of her head towards the stimuli source, changes in facial expression and guttural noises.
'Responses were intermittent, that is not occurring with each attempt to stimulate. But it seemed that when they did occur, they were in direct response to the stimulus. The actions of Terri Schiavo did not appear to be merely reflexive which is certainly inconsistent with the concept of PVS and are indications of cognitive behavior although it is difficult to determine the level of cognitive behavior".
"Mrs. Schiavo handled the swallowing of her own secretions of saliva without difficulty in a normal manner", Avery stated. "There was no dribbling, choking or gagging. This raises the possibility that she may be able to swallow and take food and water orally obviating the need for the gravity flow feeding tube under the circumstances a swallowing study or pudding food challenge is warranted.
"Upon observation, Mrs. Schiavo appeared to be very comfortable and most definitely exhibited no signs of pain or distress. In order to make further determinations, a full medical exam must be made including a neurological exam. http://www.terrisfight.org/userfiles/File/Avery%20Affidavit%20-%20Swallowing.pdf
Despite this sworn determination by Avery, he then apparently took no steps in his Hospice position to insure that swallowing tests were done nor did he apparently take any steps towards saving the life of Terri Schiavo even though his own personal assessment of Terri Schiavo differed from that of Pinellas County Probate Court Judge George W. Greer and she was under his direct supervision and care from April, 2000 until he left the hospice late in 2003---after the second attempt by Greer, Schiavo and Felos to end her life and she was saved, at least temporarily, by Terri's Law which was then ruled unconstitutional.
Brundage said that Jana Carpenter, another RN involved in Terri's case, formed with her husband a group called Professionals in Excellence comprised of physicians and lawyers of which Avery was a member. The group reportedly confronted Avery about his allegedly conflicting position of being medical director at Hospice of Florida Suncoast and how he could be involved with Terri's case. He said it was okay, that he had spoken to his pastor about it and that his pastor had told him it was okay. It was later reportedly learned that the pastor had never talked with Avery about the issue.
According to statements issued by Beverly Enterprises, the corporation is still repaying the federal government for its Medicare and Medicaid fraud. In a statement issued by CEO Floyd, he says:
"On February 3, 2000, we entered into a series of separate agreements with the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS). Under the civil settlement agreement, we paid the federal government $25 million during the first quarter of 2000 and agreed to reimburse the federal government an additional $145 million through withholdings from our biweekly Medicare periodic interim payments in equal installments ending in the first quarter of 2008. As of June 30, 2004, the present value of the remaining obligation was $55.5 million. As a result of such withholdings, our cash flows from operations were negatively impacted by $9.1 million for the six months ended June 30, 2004, and $18.1 million during the year ended Dec. 31, 2003, and are expected to be negatively impacted at an annual rate of $18.1 million until 2008.
After its audit of The Hospice of Florida Suncoast when it was found that the organization had received $14.8 million in Medicare overpayments, the Office of Inspector General of the Department of Health and Human Services issued a Special Fraud Alert in March, 1998.
OIG was established in 1976 to identify and eliminate fraud, abuse and waste in the department's programs.
To reduce fraud and abuse in the federal health care programs, including Medicare and Medicaid, the OIG actively investigates fraudulent schemes to obtain money from these programs and when appropriate, issues, Special Fraud Alerts to identify segments of the health care industry that are particularly vulnerable to abuse. The March, 1998 alert focused on the interrelationship between the hospice and nursing home industries and described some of the potentially illegal practices the OIG identified in arrangements between these providers.
WHAT IS HOSPICE CARE AND WHO IS ELIGIBLE TO RECEIVE IT
Medicare's hospice benefit provides palliative care to individuals who are terminally ill. Palliative care focuses on pain control, symptom management and counseling for both the patient and family.
In order to elect the hospice benefit, a Medicare beneficiary must be entitled to Medicare Part A services and certified as terminally ill, which is defined as a medical prognosis of a life expectancy of 6 months or less if the illness runs its normal course. A beneficiary who elects to enroll in a hospice program waives his or her rights to all curative care related to his or her terminal illness. Medicare will continue to pay for services furnished by the patient's non-hospice attending physician and for the treatment of conditions unrelated to the terminal illness.
The hospice must have a written plan of care which covers physician and nursing services, physical, occupational and speech therapy, medical social services; home health aides and homemakers; short-term inpatient care; counseling; respite care; and medical supplies including drugs and biologicals. Certain of the hospice services (core services) must be provided directly to the beneficiary by employees of the hospice, while other non-core hospice services may be provided in accordance with contracts with other providers. However, the hospice must retain professional management for all contracted services.
REIMBURSEMENT FOR HOSPICE CARE PROVIDED IN NURSING HOMES
Medicare does not have a separate payment rate for routine hospice services provided in a nursing home. Because hospice services are typically provided to patients in their homes, the routine home care hospice rate does not include any payment for room or board. For services provided to patients in nursing homes, hospices receive the Medicare routine home care rate, which is a fixed amount per day for the services provided by the hospice, regardless of the volume or intensity of the services provided. Accordingly, where the hospice patient resides in a nursing home, the patient remains responsible for payment of the nursing home's room and board changes.
If, however, a patient receiving Medicare hospice benefits in a nursing home is also eligible for Medicaid, Medicaid will pay the hospice at least 95 percent of the State's daily nursing home rate, and the hospice is then responsible for paying the nursing home for the beneficiary's room and board. The specific services included in the daily rate payment are determined by a State's Medicaid program and may vary from state to state.
In addition to the room and board payment, a hospice may contract with the nursing home for the nursing home to provide non-core hospice services (i.e. those services which the hospice is not required by law to provide itself) to its hospice patients.
VULNERABILITIES IN NURSING HOME ARRANGEMENTS WITH HOSPICES
Hospice services may be appropriate and beneficial to terminally ill nursing home residents who wish to receive palliative care. However, arrangements between nursing homes and hospices are vulnerable to fraud and abuse because nursing home operators have control over the specific hospice or hospices they will permit to provide hospice services to their residents. An exclusive or semi-exclusive arrangement with a nursing home to provide hospice services to its residents may have substantial monetary value to a hospice. In these circumstances, some nursing home operators and/or hospices may request or offer illegal remuneration to influence a nursing home's decision to do business with a particular hospice.
Hospice patients residing in nursing homes may be particularly desirable from a hospice's financial standpoint. First, a nursing home's population represents a sizeable pool of potential hospice patients. Second, nursing home hospice patients may generate higher gross revenues per patient than patients residing in their own homes because nursing home resident receiving hospice care have, on average, longer lengths of stay than hospice patients in their homes. Also, there may be some overlap in the services that the nursing homes and hospices provide, thereby providing one or the other the opportunity to reduce services and costs. A recent OIG report found that residents of certain nursing homes received fewer services from their hospice than patients in their own homes. Since hospices receive a fixed daily payment regardless of the number of services provided or the location of the patient, fewer services may result in higher profits per patient.
However, a hospice's access to nursing home patients depends on the nursing home operator. Nursing home operators may restrict residents to one or two hospice providers. While an exclusive or semi-exclusive arrangement can promote efficiency and safety by permitting the nursing home operator to coordinate care, screen hospice caregivers, and maintain control of the premises, it also enhances the value of the nursing home operator's decision. In these circumstances, some nursing home operators or hospices may request or offer illegal inducements to influence the selection of a hospice.
PAYING OR RECEIVING KICKBACKS IN ORDER TO INDUCE MEDICARE OR MEDICAID REFERRALS
Because kickbacks can distort medical decision making, result in overutilization and have an adverse effect on the qualify of care patients receive, they are prohibited under the Federal health care programs, including Medicare and Medicaid. Under the anti-kickback statute, it is illegal to knowingly and willfully solicit, receive, offer or pay anything of value to induce referrals of items or services payable by a Federal health care program.
The OIG has observed instances of potential kickbacks between hospices and nursing homes to influence the referral of patients. In general, payments by a hospice to a nursing home for room and board provided to a Medicaid hospice patient should not exceed what the nursing home otherwise would have received if the patient had not been enrolled in hospice. Any additional payment must represent the fair market value of additional services actually provided to that patient that are not included in the Medicaid daily rate.
SUSPECTED KICKBACKS
Specific practices which are suspected kickbacks include:
A hospice offering free goods or goods at below fair market value to induce a nursing home to refer patients to the hospice.
A hospice paying room and board payments to the nursing home in amounts in excess of what the nursing home would have received directly from Medicaid had the patient not been enrolled in hospice.
A hospice paying amounts to the nursing home for additional services that Medicaid considers to be included in its room and board payment to the hospice.
A hospice paying above fair market value for additional non-core services which Medicaid does not consider to be included in its room and board payment to the nursing home.
A hospice referring its patients to a nursing home to induce the nursing home to refer its patients to the hospice.
A hospice providing free (or below fair market value) care to nursing home patients, for whom the nursing home is receiving Medicare payment under the skilled nursing facility benefit, with the expectation after the patient exhausts the skilled nursing facility benefit, the patient will receive hospice services from that hospice.
A hospice providing staff at its expense to the nursing home to perform duties that otherwise would be performed by the nursing home.
Parties that violate the anti-kickback statute may be criminally prosecuted or subject to civil monetary penalties, and also may be subject to exclusion from the Federal health care programs.
A Medicare Advisory Bulletin as part of Operation Restore Trust-a joint effort among the Office of Inspector General, the Health Care Financing Administration (HCF) and the Administration on Aging within the Department of Health and Human Services to combat fraud, waste and abuse in the Medicare and Medicaid programs. The issuance of this bulletin calls specific attention to the possible misuse of the hospice benefit, as uncovered through collaborative work undertaken by the OIG and HCFA.
A reprint of this Medicare Advisory Bulletin follows.
Medicare Advisory Bulletin- Questionable Practices Affecting the Hospice Benefit October 1995
The Department of Health and Human Services administers the Medicare program for the benefit of 38 million elderly and disabled Americans. In May 1995, the Secretary of Health and Human Services announced Operation Restore Trust, a joint project of the Office of Inspector General, the Health Care Financing Administration and the Administration on Aging. Among its objectives, Operation Restore Trust seeks to identify vulnerabilities in the Medicare program, and pursue ways to reduce Medicare's exposure to fraud, waste and abuse.
This Advisory Bulletin is a product of Operation Restore Trust. The bulletin describes some potentially abusive practices which have been identified
thorough examination of the Medicare hospice benefit.
What Is Medicare's Hospice Program?
The goal of hospice care is to help terminally ill patients continue with their normal activities of daily living as comfortably as possible, while remaining primarily in a home environment. To achieve this goal, the Medicare program shifts the focus of medical attention from curative treatment seeking to reverse an underlying disease or condition to palliative or supportive care, including a wide range of medical, social, and emotional supportive services.
To be eligible for hospice services under Medicare, an individual must be certified as terminally ill by hospice medical staff and the individual's attending physician if he or she has one. Terminal illness is defined as a medical prognosis that the patient's life expectancy is 6 months or less if the terminal illness runs its normal course. The Medicare beneficiary's inclusion in a hospice program is voluntary and can be revoked by the beneficiary at any time.
The decision to elect the hospice benefit has significant consequences because the beneficiary waives the right to receive standard Medicare benefits, related to the terminal illness, including all treatment for the purposes of curing a terminal illness. Hospice coverage is divided into four discrete election periods, during each of which the beneficiary must be certified as terminally ill. The fourth and last election period has an indefinite duration, unless or until the beneficiary no longer meets the eligibility requirement of a prognosis of 6 months or less to live.
What Problems Have Been Identified?
In the course of reviewing trends in Medicare's hospice program, the Office of Inspector General has learned of activities that should be of concern to beneficiaries who are in hospice or who are considering the option of hospice. These questionable practices primarily involve issues of hospice enrollment and are the subject of ongoing analysis by the Medicare program and, in appropriate cases, investigations and audits by the Office of Inspector General. Some hospice providers, in efforts to maximize their Medicare reimbursement, may knowingly engage in one or more of the following activities:
- Making incorrect determinations of a person's life expectancy, for the purposes of meeting hospice eligibility criteria.
- Engaging in marketing/sales strategies that offer incomplete or inadequate information about Medicare entitlement and restrictions under the hospice program, in order to induce beneficiaries to elect hospice and thereby waive other treatment benefits.
- Encouraging hospice beneficiaries or their representatives to temporarily revoke their election of hospice during a period when costly services covered by the hospice plan of care are needed, so that the hospice may avoid the obligation to pay for these services.
Important Features of the Medicare Hospice Benefit
- The hospice benefit is restricted to patients with a diagnosis of terminal illness and prognosis of 6 months or less to live.
In several recent medical reviews of beneficiary eligibility for hospice, the Office of Inspector General has found significant inaccuracies in the determinations of terminal illness. These findings have prompted a concern that some hospices may intentionally misrepresent a condition as terminal in order to secure Medicare reimbursement. For instance, investigators have encountered hospices that asked nurse employees to alter notes in patients' records or to otherwise misrepresent patients' medical conditions, in order to falsify the existence of a terminal condition.
There have also been cases where physician certifications of terminal illness have been medically questionable. If a hospice submits claims to Medicare under circumstances where it knows of the absence of a terminal condition, the hospice may be liable for the submission of false claims. Criminal penalties can also be imposed against persons who knowingly and willfully make false representations about a patient's medical condition which are used to determine eligibility for payment of Medicare or Medicaid benefits.
- A hospice should not refuse to address health care needs relating to a beneficiary's terminal diagnosis.
Once a Medicare beneficiary elects hospice care, the hospice is responsible for furnishing directly, or arranging for, all supplies and services that relate to the beneficiary's terminal condition, except the services of an attending physician. Hospice beneficiaries have the right to receive covered medical, social and emotional support services from the hospice directly, or through arrangements made by the hospice, and should not be forced to seek or pay for such care from non-hospice providers.
When a beneficiary is receiving hospice care, the hospice is paid a predetermined fee for each day during the length of care, no matter how much care the hospice actually provides. This means that a hospice may have a financial incentive to reduce the number of services provided to each patient, since the hospice will get paid the same amount regardless of the number of services provided.
Medicare has received complaints about hospices neglecting patient needs and ignoring reasonable requests for treatment. One individual reported that his wife's hospice failed on three separate occasions to respond to telephonic requests for emergency services. He was forced to call a non-hospice physician who arranged for hospitalization. His wife's care required a 26-day length of stay. Although the hospital contacted the hospice the day following admission, the hospice did not visit the patient or in any way coordinate her care during the hospital stay.
The Office of Inspector General also has uncovered situations where duplicate claims were submitted by a hospice and other providers (such as
skilled nursing homes and hospitals) for services related to the beneficiary's terminal illness. In a nationwide audit
of services provided to Medicare beneficiaries enrolled in hospice programs, approximately $21.6 million
was improperly paid to hospitals and nursing homes for the treatment of hospice beneficiaries. Hospices are
required to make financial arrangements for hospitalization, nursing services and all other health care needs related to the beneficiary's terminal illness and included in the hospice plan of care. The cost of these services should be paid by the hospices.NN
- A beneficiary has a right to expect a hospice to provide complete and accurate information about the consequences of hospice election and revocation.
A hospice is obligated to inform beneficiaries or their representatives that by electing the hospice benefit, they waive all rights to curative treatment or other standard Medicare benefits related to the terminal illness, except for the services of an attending physician. Some hospices inappropriately induce beneficiaries or their representatives to enroll in the hospice program without explaining that hospice election results in forfeiture of curative treatment benefits under Medicare. For instance, some hospices have solicited the beneficiary's neighbors and friends, who in some jurisdictions may act as beneficiary representatives, and who may not be familiar with the beneficiary's medical condition. In these situations, the beneficiary and/or representative may not appreciate that traditional Medicare benefits will be denied once the hospice benefit is elected.NN
The Office of Inspector General also has learned of hospices which induce beneficiaries to revoke the hospice election if expensive palliative treatment, even for a temporary period, becomes necessary. As a consequence, beneficiaries may then be burdened with substantial co-payments that would not be charged under hospice. It is especially important to note that when a beneficiary revokes the hospice election during the last election period, re-enrollment in the Medicare hospice benefit will be precluded permanently.
You Should Be Alert to the Following Questionable Activities
- Hospice recruiters failing to notify prospective patients or their representatives that they will no longer be entitled to Medicare coverage of curative treatment if they elect the hospice benefit.
- Hospice personnel inducing beneficiaries to revoke their hospice election when more costly treatment is needed.
- A hospice refusing or failing to provide or arrange for needed care;
- Nursing home residents being induced to elect hospice but not receiving the additional benefits of hospice care;
- Non-hospice providers charging Medicare for services to hospice patients that hospices can and should provide, such as counseling or medical equipment.
What To Do With Information About Questionable Practices Involving Hospice
If you have questions about the scope of the hospice benefit or the care you are receiving in hospice, you should first consider discussing these matters with your attending physician or the hospice provider. If you wish to report questionable practices, call or write: 1- 800-HHS-TIPS, Department of Health and Human Services, Office of Inspector General, P.O. Box 23489, L'Enfant Plaza Station, Washington, D.C. 20026-3489.
http://oig.hhs.gov/fraud/docs/alertsandbulletins/hospice.pdf and
http://www.oig.hhs.gov/fraud/docs/alertsandbulletins/hospice2.pdf 8-19-06
This article was originally published by the author in May, 2005.
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© 2006 North
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