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Elder Law

Death Is a Growth Industry for Hospices; Lawsuits Detail Incentives for Referrals

Posted Dec 19, 2011 11:22 AM CDT
By Debra Cassens Weiss

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Hospice care has become a $14 billion industry that is profiting in part because of financial arrangements and gifts that encourage referrals.

Bloomberg Business examined court records and interviewed more than 45 hospice employees, patients and family members to detail the financial incentives that are helping make hospice care a growth industry.

“Compensation based on enrollment numbers, pay to nursing-home doctors who double as hospice medical directors, and gifts to the nursing facilities have helped fuel the boom,” according to the story, published in the Washington Post. Medicare usually picks up the tab on a per diem basis; it pays 90 percent of cost of hospice stays, the story says.

The article refers to seven pending or settled lawsuits alleging that incentives spurred hospices to admit patients who weren’t dying. According to one fraud suit filed by the U.S. Justice Department, a woman spent 20 months under hospice care. When she was released, she lived another four years, dying at the age of 106.

Meanwhile, the inspector general of the U.S. Department of Health and Human Services is investigating hospice marketing.

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