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Hospice Chain Agrees to Pay $8.5M to Resolve False Claims Act Allegations

July 25th, 2018

Caris Healthcare will pay $8.5 million to resolve allegations that it violated the False Claims Act by knowingly submitting false claims and knowingly retaining Medicare overpayments.

In a press release announcing the settlement, the U.S. Department of Justice (DOJ) said that it had alleged that Caris, a for-profit hospice chain with locations in Tennessee, Virginia, and South Carolina, “admitted and recertified patients for hospice care that were not eligible for hospice benefits.”

To qualify for hospice benefits, patients must have a diagnosis that supports a terminal prognosis. The DOJ claimed that the company had aggressive admission targets that fueled the erroneous admissions.

It was alleged that even after the company’s chief medical officer and other employees who worked with the patients alerted Caris to potential patient eligibility issues, Caris did not investigate or change its policies.

In a statement, Acting Assistant Attorney General Chad A. Readler said, “[When] internal audit results or other information reveal the existence of a compliance issue that is not limited to a particular claim, as was the case here, it is incumbent on providers to exercise due diligence to determine how widespread the problem is and to return any overpayments.”

The whistleblower in this case, a registered nurse who formerly worked for Caris, will receive approximately $1.4 million.

In a statement disputing the findings, Caris Healthcare noted that “the settlement of the lawsuit does not involve any admission of liability or determination of any wrongdoing.” Caris CEO Norman McRae said, “Caris has the utmost confidence in its processes for determining patient eligibility for hospice and in the clinical judgment of those within our company on the frontlines of providing care to our patients.”


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