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Jul 13, 2015 by |

Potential $200 Million Medicare Fraud Whistleblower Case to Begin Soon


The Department of Justice announced that a Medicare fraud case against AseraCare hospice facilities will start August 3, after a half-dozen employees filed whistleblower cases under the False Claims Act. The company could owe up to $202 million.

The whistleblowers, and the Department of Justice, which elected to intervene in the case in January 2012, allege that AsperaCare filed false Medicare reimbursement claims. National hospice groups are watching this case, as it will have an impact on the standards doctors must use to determine if a patient is terminally ill. DOJ attorneys wrote that they intend to prove AseraCare is liable under the False Claims Act “because it caused non-terminally ill patients to prematurely give up curative or rehabilitative care so that the company could bill Medicare for hospice payments.”

The Department of Justice, in court filings, claims that Medicare suffered nearly $67.5 million in damages. The Department of Justice analyzed random samples to arrive at that number, ultimately arguing that more than half of the cases in the sample should not have been eligible for hospice.

AseraCare operates about 60 hospice facilities in 19 states, admitting 10,000 patients per year, most of whom do not have private insurance and are on Medicare. Patients can only be considered for the Medicare hospice benefits if they are diagnosed as terminally ill with a life expectancy of six months or less. In electing to receive hospice care, patients give up seeking a cure in exchange for care for a better quality in the end of their lives. Medicare pays a predetermined fee for each day an eligible patient receives hospice care.

This case began with a 2008 whistleblower complaint in Wisconsin, which was later consolidated with complaints in Alabama and Georgia before the Department of Justice intervened.

The hospice industry has grown to include over 5,500 providers serving more than 1.5 million patients. With the industry’s growth has come increased litigation under the False Claims Act. Approximately 90 percent of hospice patients are covered by Medicare or Medicaid.

Evans Law Firm, Inc. handles qui tam/False Claims Act cases, including Medicare fraud and Medicaid fraud lawsuits. If you have a potential False Claims Act case, please contact Evans Law Firm, Inc. at 415-441-8669 or via email at

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