HHS' inspector general's office has finished its first major investigation of a hospice provider and is seeking at least $8.9 million in damages, according to internal HHS documents.
A spokeswoman for the inspector general's office confirmed that Hospice of the Florida Suncoast, Largo, had been audited and that investigators believed Suncoast owed the Medicare program at least $8.9 million in reimbursements for patients who weren't eligible for Medicare hospice care. Federal investigators flagged an additional $5.9 million in payments they say also may have been billed improperly.
Mary Labyak, executive director of the hospice, said the company plans to fight the allegations. She said the company will dispute the inspector general's recommendations in talks with HCFA officials and the state Medicare fiscal intermediary, which would collect any money owed.
"We believe our practice was what was required at the time," Labyak said. "We think they've drawn the wrong conclusions. We plan to pursue some resolution of this. The practice of the hospice has been totally in line with the regulations."
Labyak contends federal investigators reviewed a "skewed sample" of beneficiaries that represented only 2% of the hospice's patient population. She also said the results of the investigation boiled down to "a difference in medical opinion of when people should be admitted to a hospice."
The audit is part of the inspector general's "Operation Restore Trust," which seeks to link various federal and state law enforcement branches to fight healthcare fraud and abuse.
Investigators looked at the records of 364 beneficiaries, according to the HHS document. Of that sample, 176 were not eligible for hospice coverage and an additional 118 cases were flagged for further review.
According to federal regulations, a beneficiary must be terminally ill with a life expectancy of less than six months to be eligible for hospice care under Medicare.
According to the HHS memo, investigators reviewed only cases that had been in Suncoast more than 210 days.
"We believe the identified problems with the 176 beneficiaries occurred due to inaccurate prognoses of life expectancy by hospice physicians based on the medical evidence in the patients' files," HHS said.
In an unrelated event, the inspector general's office also said last week it had reached an agreement with two clinical laboratory companies, MetPath, a subsidiary of Corning Clinical Laboratories, and Unilab, over allegations the labs submitted false claims to Medicare. Under the agreement, Corning will pay $6.9 million and Unilab $4.1 million in penalties and restitution to the Medicare program.
Both companies denied any wrongdoing.
The government said the labs billed Medicare for blood profiles that were not medically necessary or ordered by physicians.