Elderly lady woman patient holding red heart in her hand

Hospice Matters & Hospice Fraud Harms

“You matter because you are you, and you matter to the end of your life. We will do all we can not only to help you die peacefully, but also to live until you die.”
Dame Cicely Saunders, nurse, physician and writer, and founder of hospice movement (1918 – 2005)

This quote sums up the essence and importance of Medicare’s hospice coverage. It is an essential benefit that supports people with terminal illnesses in enjoying peace, comfort and dignity in the last chapter of their lives. In addition to providing physical treatment focused on pain relief, quality of life and comfort (versus curative treatments), hospice provides emotional and spiritual support to the patient and family and respite support to family caregivers as well.

Added to the Medicare Part A coverage in 1986, hospice has long been an under-utilized benefit that, in the past, was mostly provided by charities and non-profit organizations. Yet in recent years, as hospice providers have increased, particularly for-profit entities, so has hospice fraud. 

California is leading the nation in serious complaints and inspection concerns regarding subpar hospice care, according to an Office of Inspector General report. This mirrors our on-the-ground experience at our California Senior Medicare Patrol (SMP) as it continues to be one of the top three types of Medicare fraud cases reported. 

Why is this the case?

Becoming a hospice provider takes relatively little investment (a few thousand dollars), compared to setting up a skilled nursing facility or doctor’s office. People running a hospice do not need to have experience in the hospice industry or meet educational qualifications. And, there is also little oversight. In fact, over 80% of California hospices are inspected by private accreditation agencies rather than state regulators to ensure compliance with federal standards. This system sets the stage for false and inflated reviews with some hospices giving financial incentives to accreditors to be excessively lenient. After all, it’s currently the hospice providers who select and pay for the inspectors themselves. All this sets up the conditions ripe for fraud. 

And the pay from Medicare? It’s very lucrative, as hospice claims can bring in at least $154 to $1,432 a day per patient in Medicare payments. This has spurred a burgeoning growth of illegal and fraudulent hospice providers along with a wide ring of complicit doctors receiving kickbacks and bold recruiters going after Medicare beneficiaries from all walks of life.

In addition to the low investment, little oversight and high pay, so far there are also virtually no monetary fines/penalties for hospices with serious complaints of mistreatment of patients and/or failure to provide adequate care. If they are not holding up to a good standard, or have caused harm to a beneficiary, right now there is no monetary penalty. Thankfully, this will change due to the Federal Hospice Act passed in late 2020, and is now being implemented as of Oct 1, 2021. 

What is happening on a national level?

Across the country, many unscrupulous hospice providers are recruiting and enrolling non-terminally ill patients for end-of-life care they do not need, and then billing Medicare for services and items they may never receive. They trick beneficiaries into signing up for hospice by offering freebies, such as additional groceries, nurse visits, durable medical equipment, shakes, bus coupons, gloves and masks and more once they enroll. 

They also make false claims, such as saying, “Medicare now covers cooking and cleaning services”. Or they tell beneficiaries they qualify due to age, saying, “You’re now old enough to qualify for hospice!” Another tactic is giving money, with some recruiters telling beneficiaries, “you can earn $400/month if you agree to enroll in our program.” 

Such enticing offers can be hard for beneficiaries to turn down. Yet those beneficiaries who sign up, also unknowingly sign away their right to receive life-saving medical care, which isn’t covered when on hospice. 

In addition, fraudulent hospice providers and recruiters often disproportionately target people with limited English proficiency, as they are more vulnerable and often don’t understand the English paperwork. In California, where 44% of Californians speak a language other than English at home, according to the U.S. Census Bureau, we definitely see this trend.

What’s happening in California? Cases reported to our California SMP

As mentioned in the beginning, California is leading the nation in hospice fraud reports and serious complaints. In Los Angeles County alone, hospices have multiplied sixfold in the last decade and now account for more than half of the state’s roughly 1,200 Medicare-certified providers, according to an analysis of federal healthcare data by the L.A. Times

These trends and facts mirror what we’re seeing reported to our California Senior Medicare Patrol (SMP). For some examples, let’s dive into a few hospice fraud case stories recently reported to our SMP:

  • 84 year old Juan resides at a senior apartment complex. He asks: “Why is Medicare paying this company so much money when all they did was check my blood pressure, send me chocolates and hand sanitizer? They visit my neighbors, too.”
  • 82 year old Nancy reviews her quarterly Medicare Summary Notices (MSNs). She states: “My MSN shows I’m on hospice. I never agreed to this. I’m not dying.”
  • 70 year old Margarito does not speak English. She says: “A woman approached me at a grocery store parking lot offering to help me get a better wheelchair. She took a picture of my Medicare card with her cell phone and had me sign a form. I still don’t have my chair and now my ear and eye doctors won’t see me. My cardiologist said he can’t write me a prescription due to being in hospice. What’s hospice? Can you help?”
  • 84 year old Elias was unaware of his hospice enrollment until he went to the pharmacy to get his prescription filled and was told they could not fill it due to his hospice status.
  • 78 year old Vietnamese-speaking Thuong discovered he had erroneously been enrolled in hospice when he received a call from his primary doctor’s office saying Medicare would not pay for a flu shot claim, because Medicare records showed him on hospice.

These cases highlight the fact that hospice fraud is not a victimless crime. It’s not just about Medicare losing billions of tax-payer dollars to fraud, which is bad enough. It is about the negative effect hospice fraud has on people’s lives, their health and wellbeing and sometimes even causing premature death. Such negative effects are apparent in the cases listed above. We hear from worried beneficiaries, like Elias, who can’t get their prescriptions at the pharmacy, or from people like Margarito, who lose access to their specialists. Other beneficiaries are forced to postpone surgeries and pay expensive bills since Medicare has denied claims, such as lab work or medical visits due to hospice status. And still, in some cases beneficiaires have experienced significant health declines while others even lost their life due to improper treatment and neglect. 

How to prevent, detect and report hospice fraud

Our California Senior Medicare Patrol (SMP) is working hard to stop such fraud. One way you can help is to educate yourself and your loved ones about hospice fraud, what to look for and how to avoid it. Here are some good tips to start with and share:

  • Beware of hospice companies enrolling patients who do not have a terminal illness with 6 months or less to live. Medicare’s hospice benefit is only for those who are terminally ill.
  • Don’t get tricked by hospice companies offering free services such as housekeeping and cooking. Medicare does not pay for this!
  • Watch out for “freebies”, such as bus coupons, medical equipment, food supplements or even payment for enrolling into hospice. These are all scams.
  • Beware of calls or unannounced visits by hospice companies offering additional benefits such as nurse visits, walkers, disposable diapers and OTC medication.

If you or someone you know comes across such scams, report any suspected hospice or other Medicare fraud to our California SMP at 1-855-613-7080.

Resources for more information on hospice care
If you, your loved ones, and/or your clients are interested in learning more about hospice, how to choose a hospice and how to access inspection reports, below is a good list of resources. Remember, if you come across anything suspicious in regards to hospice or other types of Medicare fraud, please report it to our California SMP at 1-855-613-7080.

The California Department of Public Health has a searchable database with information on inspection reports. Unfortunately, reports by accreditation agencies are not included, even though they do the majority of inspections.