TALLAHASSEE -- The U.S. Department of Justice has sued the hospice company founded by Florida Senate President Don Gaetz, accusing the company of engaging in Medicare fraud for more than 11 years, including during the time Gaetz was vice chairman.
The lawsuit, filed May 2 in the district court for the western district of Missouri, alleges that since at least 2002 Vitas Hospice Services and Vitas Healthcare Corp., the largest provider of for-profit hospice services in the country, “misspent tens of millions of taxpayer dollars from the Medicare program.”
Gaetz sold the company in 2004 to its current owner, Cincinnati-based Chemed, and reportedly no longer owns any shares or has any affiliation with the company. Chemed operates hospice services in 18 states including Florida.
The suit, filed on the eve of the final day of the legislative session, alleges that Chemed and its hospice subsidiaries defrauded Medicare by billing the agency for patients who were not eligible for hospice care, and for charging Medicare for crisis care given to patients who either didn’t need it or never received it.
Gaetz, R-Niceville, who was elected to the Senate in 2006, said through a spokeswoman late Wednesday that the Department of Justice complaint involves issues that occurred after he left the company.
Since 2004, "and for the past nine years, President Gaetz has not owned any stock in the company or served in any capacity as an employee, officer, director, consultant or volunteer,’’ said Katie Betta, Gaetz’s Senate spokeswoman. "The complaint relates to matters long after President Gaetz sold his interest in the company."
The company said in a statement issued May 3 that it intends “to defend this lawsuit vigorously.”
"Chemed and VITAS have made significant investments in controls, systems and procedures to uphold the highest industry standards and to maintain compliance with all regulatory requirements,’’ the statement said. "Our compliance efforts are designed to ensure our services are provided only to eligible patients.”
Under federal law, only dying patients with six or fewer months to live are eligible to receive Medicare-reimbursed hospice care and only patients "experiencing an acute crisis that requires the immediate and short-term provision of skilled nursing services" are eligible to receive so-called crisis care, the most costly form of hospice care, according to the complaint.
In 2013, for example, Medicare’s daily reimbursement rate for crisis care was $742 more per patient than the daily rate for routine home care, the complaint said.
The lawsuit alleges that Vitas Healthcare systematically attempted to overcharge Medicare for services that were either not provided or given to patients who were not eligible for the level of care billed to Medicare. The Justice Department also claims the company used aggressive marketing tactics and pressured staff to increase the number of crisis care claims submitted to Medicare and set goals for the number of days that were to be billed.
The complaint cites the example of a California patient identified only as "MC." Vitas reported that the patient was eligible for Medicare-reimbursed hospice care, the complaint alleges, but the company’s own records stated that MC did not have a terminal illness whose prognosis was six months or less. She was instead, "living independently and performing daily activities without assistance," including doing her own laundry.