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OIG widens crackdown on hospices

January 16, 2013
by Pamela Tabar, Associate Editor
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A San Diego hospice becomes the latest recipient of a federal audit during the widening crackdown by the Centers for Medicare & Medicaid (CMS) on billing practices in hospice facilities. In reponse, San Diego Hospice has discharged about 100 patients who were determined to have more than six months to live, requiring the organization to lay off 260 workers, Kathleen Pacurar, the hospice’s president and CEO, told KHN. The investigation is still ongoing.

By definition, hospices usually care for patients who are within six–12 months of death. But CMS has decided too many facilities may be pushing the definition of “end-of-life care” and admitting far too many patients who aren’t actually in their final stages of life—or failing to discharge them if their health status improves.

In its 2013 Work Plan, the Office of Inspector General (OIG) vowed to scrutinize the operational and marketing aspects of several healthcare segments, including hospices, nursing homes and home health agencies. With regard to hospices, the OIG promised to "review hospices' marketing materials and practices and their financial relationships with nursing facilities" and to examine hospice records and billing for care and Medicare Part D drug requests back to 2005, to "address concerns that this level of hospice care is being misused."

Last week, a central Florida hospice faced scrutiny by the Department of Justice, which took over lawsuits alleging the facility housed—and billed CMS for—patients who were not terminally ill.

But the OIG crackdown has left some hospices unsure of the best business models. "What do you do with patients who maybe aren't dying tomorrow, but have got a whole year or two where they need a higher level of care?" Pacurar told KHN. "You're seeing healthcare try to figure out that gap."

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