Senate President Don Gaetz sold his ownership in Vitas Hospice Services in 2004 but federal officials say the company was engaged in Medicare fraud before that.

Herald/TimesTallahassee BureauMay 10, 2013 

TALLAHASSEE -- The U.S. Department of Justice has sued the hospice company founded by Florida Senate President Don Gaetz, accusing the company of engaging in Medicare fraud for more than 11 years, including during the time Gaetz was vice chairman.

The lawsuit filed May 2 in the district court forthe western district ofMissouri alleges Vitas Hospice Services and Vitas Healthcare Corp., the largest provider of for-profit hospice services in the country, "misspent tens of millions of taxpayer dollars from the Medicare program," since at least 2002.

Gaetz sold the company in 2004 to Cincinnati-based Chemed, and reportedly no longer owns any shares or has any company affiliation. Chemed operates hospice services in 18 states, including Florida.

The suit alleges Chemed and its hospice subsidiaries defrauded Medicare by billing the agency for patients ineligible for hospice care, and for charging Medicare for crisis care given to patients who either didn't need it or never received it.

Gaetz, R-Niceville, elected to the Senate in 2006, said through a spokeswoman that the Department of Justice complaint involves issues that occurred after he left the company.

"For the past nine years, President Gaetz has not owned any stock in the company or served in any capacity as an employee, officer, director, consultant or volunteer,'' said Katie Betta, Gaetz's Senate spokeswoman. "The complaint relates to matters long after President Gaetz sold his interest in the company."

The company said in a statement issued May 3 that it intends "to defend this lawsuit vigorously."

"Chemed and VITAS have made significant investments

in controls, systems andprocedures to uphold thehighest industry standards and to maintain compliance with all regulatory re-quirements," the statement said.

"Our compliance efforts are designed to ensure our services are provided only to eligible patients."

Under federal law, only dying patients with six or fewer months to live are eligible to receive Medicare-reimbursed hospice care and only patients "experiencing an acute crisis that requires the immediate and short-term provision of skilled nursing services" are eligible to receive so-called crisis care, the most costly form of hospice care, according to the complaint.

In 2013, for example,Medicare's daily reimbursement rate for crisis carewas $742 more per patient than the daily rate for routine home care, the complaint said.

The lawsuit alleges Vitas Healthcare systematically attempted to overcharge Medicare for services not provided or given to patients not eligible for the level of care billed to Medicare.

The Justice Department also claims the company used aggressive marketing tactics and pressured staff to increase the number of crisis care claims submitted to Medicare and set goals for the number of days that were to be billed.

The complaint cites theexample of a Californiapatient identified only as "MC."

Vitas reported the patient was eligible for Medicare-reimbursed hospice care,the complaint alleges, butthe company's own records stated MC did not havea terminal illness whose prognosis was six months or less.

She was instead, "living independently and performing daily activities without assistance," including doing her own laundry.

The cost to Medicare forcrisis care for MC was $170,999 between 2009 and 2012, according to the complaint.

The Justice Department found Vitas' billings for crisis care almost six times higher than the national average.

A Vitas nurse reported she more than once arrived at the home of a patient described by Vitas as needing crisis care but instead would find the patient "at church, at the beauty parlor, or playing bingo," the complaint said.

These patients did not need or receive crisis care, the complaint alleges, but Vitas billed Medicare for the services anyway.

The complaint seeks treble damages, statutory penalties and the costs of the action plus interest.

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