March 1, 2017

Sixteen charged in $60M Medicare hospice fraud scheme

By the C|C Whistleblower Lawyer Team

The Department of Justice announced yesterday that a grand jury returned an indictment charging 16 Texas individuals with participating in a scheme to commit healthcare fraud, billing Medicare and Medicaid over $60 million for fraudulent hospice services, of which the government actually paid over $35 million. Defendants allegedly improperly placed patients in hospice and continuous care, sometimes without any physician consultation, and administered high doses of controlled substances, regardless of whether the patient needed the medication.

Novus Health Services, co-owned and operated by defendant Bradley Harris, submitted the allegedly fraudulent claims to the government. The indictment says Harris, an accountant with no medical license, directed patient care along with Novus nurses. Novus allegedly recruited and employed licensed physicians, paying them medical director salaries in exchange for hospice patient referrals, but the licensed physicians provided “little to no oversight of Novus’s hospice patients.”

Instead, defendants who were not doctors determined when to certify, recertify, or discharge patients from hospice, and when to place patients on continuous care. And when a patient was on continuous care, Novus nurses administered controlled medications like morphine or hydromorphone irrespective of patient need, a practice resulting in instances of “serious bodily injury or death to the beneficiaries.” DOJ says the decision to medicate patients was driven by Harris’s desire to create documentation to justify Medicare billing.

John Parker, U.S. Attorney for the Northern District of Texas, commented “[t]hat tens of millions of dollars were stolen through fraud is shocking enough. That these defendants used human life at its most vulnerable stage as the grist for this scheme displays a shocking level of depravity that this community simply cannot tolerate.”

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