SC Hospice Lawsuit Nets $1.3 Million

Harmony Care Hospice of South Carolina and its owner/CEO have agreed to pay nearly $1.3 million for submitting false Medicare claims on behalf of it patients.

The settlement – announced November 21 by the U.S. Department of Justice – came in a South Carolina whistleblower lawsuit.

The lawsuit was filed by two former Harmony employees, Mona Singletary and Lynda Fulton, under the qui tam, or whistleblower, provisions of the False Claims Act.

Under the False Claims Act, private citizens can sue for false claims on behalf of the United States and share in any recovery. Together, Singletary and Fulton will receive $244,529.87 as their share of the government’s recovery.

Hospices like Harmony Care provide palliative care – medical treatment that concentrates on reducing the severity of a disease’s symptoms – to patients who elect not to pursue curative care of their illness.

According to a Justice Department press release:

Medicare beneficiaries are entitled to hospice care if they have a terminal prognosis of six months or less. The United States alleged that Harmony and [CEO Daniel] Burton knowingly submitted or caused to be submitted false claims for patients who did not have such a prognosis and thus were not eligible for hospice care.

Under today’s agreement, Burton is individually liable for $200,000 of the settlement amount.

“Billing Medicare for unnecessary or inappropriate end-of-life care contributes to the soaring costs of health care for everyone. Today’s settlement demonstrates the Department of Justice’s efforts both to protect public funds and safeguard Medicare beneficiaries,” said Stuart F. Delery, Principal Deputy Assistant Attorney General of the Civil Division.

As a condition of the settlement, Harmony and its CEO will enter into a Corporate Integrity Agreement, which will include federal monitoring to avoid future problems.

The settlement is a victory for the 2009 Health Care Fraud Prevention and Enforcement Action Team (HEAT). The HEAT initiative pairs the Justice Department and the Department of Health and Human Services in combating Medicare and Medicaid financial fraud.

A potent tool in that effort is the False Claims Act, which has been used to recover more than $10.1 billion since January 2009 in cases involving fraud against federal health care programs.

Recoveries in False Claims Act cases of all types in that same time period exceed $13.9 billion.

The case United States ex rel. Singletary, et al. v. Harmony Care Hospice, Inc., et al., Case No. 2:10-cv-01404-PMD (D.S.C.).

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