Former exec alleges Florida hospice filed claims for patients not terminally ill; government joins lawsuit

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The federal government has joined a whistleblower lawsuit against a Florida hospice over what it says were fraudulent Medicare payments, the Department of Justice announced.

The former vice president of finance at The Hospice of the Comforter, Douglas Stone, alleges that the non-profit submitted false claims to Medicare for patients who were not terminally ill. The lawsuit says that the employees were instructed to admit Medicare beneficiaries when it hadn't been determined they were eligible. Allegedly, when the company formed an internal committee to review the eligibility of Medicare patients in 2009-2010, it discharged at least 150 patients as ineligible, the Department of Justice said.

“It is critically important that Medicare remains solvent in order to provide hospice benefits, and that we confront those whose practices in this area put economic gain before patient care,” said Robert O'Neill, U.S. Attorney for the Middle District of Florida, in a statement Thursday.   

Hospice of the Comforter's outside counsel, LaTour (L.T.) Lafferty, said the discharge of the patients reflects how the organization took the government's hospice rules to heart, and that Stone had been terminated for cause.

"We are cooperating with the government and engaged in negotiations for the past nine months," he said. "We look forward to resolving the case."

"We would like to reaffirm our commitment to our patients," he said. "We have a good reputation in the community."

The DOJ is joining under the False Claims Act, which lets the U.S. intervene and take over primary litigation. It also allows the government to recover three times the damages and civil penalties.  

The Department of Justice also joined a similar whistleblower lawsuit against AseraCare in January.

The Commercial Litigation Branch of the Justice Department's Civil Division, the U.S. Attorney's Office for the Middle District of Florida and the Department of Health and Human Services' Office of Inspector General investigated the hospice case in Florida.