Medicare Fraud Case Claims Optum Put Patients in Hospice Care Who Weren't Terminal

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A screen capture from Optum Palliative Care's website. More photos below.
The U.S. Justice Department has decided to join in a federal lawsuit filed by two Colorado whistleblowers; it alleges that a national palliative care provider improperly billed Medicare millions of dollars for hospice services provided to patients who weren't terminally ill. The suit against Optum Palliative and Hospice Care claims that the company offered hefty bonuses to employees who kept the numbers of patients up and fired those who attempted to weed out patients who weren't eligible for hospice benefits.

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"Hospice care plays a critical role in our health care system, providing for end-of-life care as opposed to curative life care," said John Walsh, Colorado's U.S. Attorney, in a statement announcing the lawsuit. "When companies overbill Medicare by keeping people in hospice when they don't need to be there, it jeopardizes the important benefit for others under the program."
U.S. Attorney John Walsh.
The Minnesota-based Optum, formerly known as Evercare, operates in eleven states. The lawsuit was originally filed in 2011 by two former employees, Lyssa Towl and Terry Lee Fowler, under the False Claims Act, which allows citizens to sue on behalf of the government to recover funds that were improperly paid. The case was sealed for three years from public view while the feds decided whether to join in the litigation but was finally unsealed late last week.

Towl, at one time the company's executive director for northern Colorado, and Fowler, an RN who became a regional hospice quality manager, claim that up to one-fourth of Evercare's hospice clients at any given time didn't meet the Medicare eligibility requirements. Such care is reserved for patients with a life expectancy of six months or less, but the plaintiffs claim the company billed for patients who suffered from dementia, non-terminal pulmonary problems and other diagnoses such as "failure to thrive" -- and sometimes collected benefits for years. By way of example, the complaint in the lawsuit lists 21 cases involving patients who didn't meet the hospice criteria but generated Optum billings for periods ranging from several months to three years.

Between 2008 and 2010, Towl and Fowler claim, the number of Evercare hospice patients exceeding 180 days of billings rose from 28 percent to 44 percent, suggesting that close to half the cases may have been suffering from something other than a terminal illness and were thus ineligible.

Lyssa Towl, in a Facebook photo.
Towl claims that she was fired for discharging ineligible patients. Fowler claims to have been put on a "corrective action plan" for also questioning the company's methods.

In response to a request for comment on the case, a spokesman for Optum issued a brief statement: "We are grateful for the opportunity to deliver high-quality, compassionate hospice care to patients and their families. We stand by the services and care provided to our patients in their time of need, and we will vigorously defend our actions."

Richard LaFond, an attorney for Towl and Fowler, says the amount of disputed billings may reach as high as $36 million; under the False Claims Act, damage awards can be doubled or even tripled, in addition to assessed penalties and fees.

Other cases alleging improper hospice care billings are pending elsewhere, and the Colorado action against Optum has already been consolidated with another case in Illinois. LaFond sees the allegations as part of a larger, disturbing trend in health care. "We're watching the emergence of the bean counters," he says. "CFOs are making decisions that medical officers should be making. It's adversely impacting the whole industry."

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Susan Donlan Roy
Susan Donlan Roy

After a car accident, the hospital shrink came in to ask how I was doing. 3 minutes in the room (not by my choice), and they billed my insurance company just over $200. When I audited the bill, I made them remove that charge.

Matt Leising
Matt Leising

And just think, they run health care now! Genius...

Leon Wilcox
Leon Wilcox

Corporate greed. No one will get in trouble for this but if I stole that much money I'd be locked up immediately

Jef RV
Jef RV

No surprise that the 2nd comment was posted by someone who blames the government for inefficiency. Probably wants his taxes lowered too. Suckers abound!

Michael Hartman
Michael Hartman

You mean to tell me that a government-funded agency is corrupted and wasteful? Shocker.

Jef RV
Jef RV

Fairness depends on checks & balances. Some don't see the wisdom of providing funding for checks & balances, & I think those people truly deserve the freedom to be robbed. Back when I was in sales, we called those people "suckers." The funny thing about sales is that we got higher commission % for selling crap than we did for selling higher-quality merchandise. I never liked that part of the job, but some did very well for themselves by pushing the crap. It takes all kinds.

muhutdafuga topcommenter

Mean old people that aren't quiet sick enough to die soon enough.  This reminds me of the republican healthcare plan...."if you get sick, die soon."

GuestWho topcommenter

"Hospice care is a type of care and philosophy of care that focuses on thepalliation of a chronically illterminally ill or seriously ill patient's pain and symptoms, and attending to their emotional and spiritual needs."

"Within the United States the term is largely defined by the practices of the Medicare system and other health insurance providers, which make hospice care available, either in an inpatient facility or at the patient's home, to patients with a terminal prognosis who are medically certified to have less than six months to live."  -- Why does the USA continue to deny non-terminal patients with chronic pain adequate pain management treatment?  Politicians need to mind their own business and stay out of people's personal medical problems.

Crackdown on painkiller epidemic hurts legitimate patients

DonkeyHotay topcommenter

You might want to mention the under the False Claims Act, the whistelblowers are entitled to 30% of all the millions recovered by the U$ Government.

RobertChase topcommenter

A caption for your screen-capture:  "It's going to be great, dying at Optimum!"

DonkeyHotay topcommenter


Rethuglykkkan Health Care = if you can't pay Ca$h, then don't get sick

fishingblues topcommenter


Hey you fucking moronic hypocrite, don't you call yourself names when you fuck up?

"You might want to mention the (sic) under the..."

This is why people refer to you as a shit stain.  Off course, in your  case, you are actually literally shit stained as well.     

DonkeyHotay topcommenter

@RobertChase ... Optum, numbnuts. 

Are you becoming as illiterate as Wasteword, who has it spelled incorrectly in the URL?

DonkeyHotay topcommenter

@fishingblues <== fecal-encephalitic coprophiliac

"I have plenty shit for brains" -- fistingblues

fishingblues topcommenter

@DonkeyHotay <=== shit stain  

That's what I thought.  Did I hear "uncle" in the midst of all the tears?  

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