One of the nation's largest providers of hospice care has agreed to pay $25 million to settle a Medicare fraud case initiated after a former company nurse in Milwaukee filed a whistle-blower suit.
It was the second such settlement in six years for Odyssey Healthcare Inc., which paid the federal government $12.5 million in 2006 after another Wisconsin-based employee sued.
"The real heroes of these cases are the medical professionals who stood up against the alleged fraud," said Nola Hitchcock Cross, their Milwaukee attorney. "The real winners in this fraud-fight story are the taxpayers."
The whistle blowers don't do too badly, either. Under the False Claims Act, they are entitled to a cut of the recovery and will share about $4.6 million.
Odyssey, which operates in 26 states, is now part of Atlanta-based Gentiva Health Services, which runs hospice offices in West Allis and Burlington. Gentiva officials declined to comment, but referred to an announcement it posted on its investor relations website last month.
"Gentiva cooperated fully with this investigation, which covered a period prior to our acquisition of Odyssey, and the settlement is consistent with our efforts to instill Gentiva's culture of compliance throughout the company," said John Camperlengo, general counsel and chief compliance officer.
The statement said the firm is proud of the care its thousands of hospice clinicians provide, and of Gentiva's efforts to ensure strict compliance with all regulatory requirements.
Medicare provides a benefit meant to cover hospice care for the terminally ill. It covers 24-hour in-home nursing service only during limited crisis periods. But from 2006 to 2009, Odyssey practiced a pattern of enrolling and recertifying non-terminal patients, and billing for continuous care that wasn't necessary or reasonable, according to the False Claims Act suit filed in 2008 but just unsealed Thursday.
Suits are sealed
Under the act, citizens with evidence of fraud against government contracts can sue on behalf of the government to recover the stolen funds in the form of triple damages, and are entitled to a portion of any award. The suits are filed under seal for 60 days to allow government prosecutors time to consider joining the cases. If they do, the cases remain secret even longer.
U.S. Attorney James Santelle said the case shows the government's continued commitment to battling health care fraud, and its support for whistle blowers' roles in that effort.
Jane Tuchalski, a registered nurse, was fired by Odyssey after raising concerns about company operations, and she filed the federal suit. Other Odyssey employees, from Virginia and Texas, later filed their own False Claims Act suits. One was folded into the Milwaukee case and one was dismissed.
In addition to sharing in the recovery, Tuchalski reached a separate private settlement with Odyssey over her claim of retaliatory termination.
She said other former employees also may have recovered money from Odyssey for retaliatory firing, even if their False Claims actions were dismissed and they did not collect part of the settlement. Under the act, employees fired for revealing fraud are entitled to double back pay and benefits and special damages.
Because the actions are filed under seal, many times there are multiple claims by different employees or others with inside knowledge who don't know that other claims have been filed. The first person to file generally gets the greatest share of any recovery.
"You can work on cases for years and then find out you weren't first to file, and get a bag of beans," Cross said. "You have to be motivated by cleaning up fraud, potential fraud and potential harm to patients."
The federal government says it recovered $4.1 billion in fraudulent health care payments in 2011, and charged 1,430 people with crimes related to that fraud.
No one has been charged in connection to the Odyssey hospice fraud.
About half the 2011 recoveries were attributed to civil actions begun under the False Claims Act.
Friday, March 02, 2012
Whistle-blower case on hospice fraud settled for $25 million - JSOnline