Dying to Defraud

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Since Medicare began offering hospice services in 1983, it’s use has grown substantially. A report by the Medicare Payment Advisory Commission (MedPAC) stated that in 2015, more than 1.38 million Medicare beneficiaries received hospice care from approximately 4,200 providers costing about $15.9 billion. Today’s fraudster is a Cleveland, Mississippi doctor who committed Medicare fraud by incorrectly diagnosing patients so nearly $2 million in fraudulent claims could be submitted to the government healthcare program.

In order to qualify for hospice services under Medicare, a beneficiary must be certified by a physician or medical director of a hospice organization as having a terminal illness with a life expectancy of less than six months. (If the patient agrees to receive hospice care, they also give up the right for a curative treatment.)

Today’s fraudster referred patients, who were not qualified to receive hospice treatment, to two hospice companies owned by one person. (He certified them as terminally ill when they were not.) In exchange for the referrals, the hospice company owner paid the physician more than $47,000 in cash kickbacks.

Here’s a bit of information on how hospice fraud can be detected. When a large number of live patients are discharged from hospice care, there’s a good chance that something illegal is going on. In 2014, Centers for Medicare and Medicaid Services (CMS) reported that the State of Mississippi led the nation in live discharges at 20.6 percent compared to the national rate of 11 percent. (Obviously, the discharge rate should be zero if all patients were qualified to have hospice care.)

The 62-year-old doctor admitted to certifying non-qualified Medicare beneficiaries to receive hospice care, which resulted in more than $1.9 million in Medicare payments. He pleaded guilty to healthcare fraud and was sentenced to 39 months in federal prison and three years of supervised release. He must also pay restitution in the amount of $1,941,254 to Medicare.

Hospice is a perfect avenue for the perpetuation of fraud by those in the healthcare industry who are looking to make an easy buck. A study by the Office of Inspector General of the U.S. Department of Health and Human Services reports that hospices inappropriately billed one-third of general inpatient stays, costing Medicare $268 million in 2012.

This corrupt Mississippi doctor exploited many patients and their families by participating in this Medicare fraud hospice scam. Let’s hope this sends a strong message to other dishonest medical professionals who are thinking about abusing the nation’s healthcare system. (While this physician may have lined his pockets with extra cash by cheating death, my guess is this fraudster is not dying to start his 3+ year prison term.)

Today’s “Fraud of the Day” is based on a Department of Justice press release entitled, Cleveland Doctor Sentenced in Hospice Fraud Case,” released on August 14, 2017.

OXFORD, Miss. – Robert H. Norman, Acting United States Attorney for the Northern District of Mississippi; Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General; Christopher Freeze, Special Agent in Charge at the Federal Bureau of Investigationand Mississippi Attorney General Jim Hood announced that:

Dr. Nathaniel Brown, 62, of Cleveland, Mississippi, was sentenced Thursday, August 10, 2017 before United States District Judge Neal B. Biggers, Jr. in Oxford, Mississippi. Dr. Brown was sentenced to serve thirty-nine (39) months in federal prison followed by three (3) years supervised release and ordered to pay $1,941,254 in restitution to the Medicare program.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.