The largest Medicare whistleblower settlement of $75 million will be paid by Chemed, a deal that was announced Monday, Oct. 30, 2017.

Chemed did not admit liability, but its subsidiaries allegedly submitted false Medicare claims that gave rise to a government lawsuit and three whistleblower suits that were filed in the states of California, Illinois and Texas.

Vitas Hospice Services LLC and Vitas Healthcare Corporation are two of Chemed’s subsidiaries named in the settlement. Vitas is the largest for-profit hospice chain in the United States. Chemed and its subsidiaries were required to sign a five-year Corporate Integrity Agreement overseen by the U.S. Department of Health and Human Services in addition to turning over the $75 million in their Medicare whistleblower settlement.

“Medicare’s hospice benefit provides critical services to some of the most vulnerable Medicare patients, and the department will continue to ensure that this valuable benefit is used to assist those who need it, and not as an opportunity to line the pockets of those who seek to abuse it,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division in a statement.

Medicare Whistleblower Settlement Exposes False Claims

Vitas allegedly submitted a variety of false Medicare claims.

The hospice care company claimed to provide hospice services to people who were not terminally ill patients. The charges submitted were supposedly to help patients that chose end of life care to cope with a terminal issue.

Most of the time, such patients know they have six months or fewer to live because they have chosen to not endure any more life-extending treatments. Instead, hospice patients have made the decision to let their illness progress naturally.

Vitas was accused of billing hospice services for people who were not terminally ill and who could have received help in the form of medical treatment for their illnesses.

The Medicare whistleblower settlement also provides details that Vitas billed for services that were unnecessary or were never provided. The government complaint alleged that Vitas held a type of competition that allowed employees to be rewarded for submitting the most patients’ home health care claims. Whether or not the patient’s condition warranted such care made no difference.

“Health care providers who knowingly overbill our programs simply to increase their profits need to be put on notice that such conduct will not be tolerated, and we will pursue any and all remedies at our disposal to protect the taxpayer and the Medicare and Medicaid programs,” said a statement from Steve Hanson, an agent for the U.S. Department of Health and Human Services.

The three whistleblowers in California, Illinois and Texas were shareholders who realized Vitas had billed Medicare for much longer and for more hospice care than competitors had billed. Because those Medicare whistleblower lawsuits were consolidated with the government suit, the amount that the plaintiffs will receive has yet to be determined.

More than 70 percent of Chemed’s revenue was from Vitas, and more than 90 percent of Vitas’ revenue allegedly was due to money obtained from Medicare and Medicaid. That information is according to one Medicare whistleblower lawsuit from an investor that was originally dismissed in a Delaware federal court.

The Medicare Whistleblower Lawsuits are  United States v. Vitas Hospice Services, LLC, et al., Civil Action No. 13-00449 (W.D. Mo.); United States ex rel. Laura Spottiswood v. Chemed Corporation, et al., Civil Action No. 13-505 (W.D. Mo.), transferred from the United States District Court for the Northern District of Illinois; United States ex rel. Barbara Urick v. VITAS HME Solutions, Inc., et al., Civil Action No. 13-536 (W.D. Mo.), transferred from the United States District Court for the Western District of Texas; and United States ex rel. Charles Gonzales v. VITAS Healthcare Corporation, et al., Civil Action No. 13-00344 (W.D. Mo.), transferred from the United States District Court for the Central District of California.