Results 1 to 2 of 2

Thread: Hospice industry booms, thanks to referral bonuses

  1. #1
    Super Moderator cougarnurse's Avatar
    Join Date
    Oct 2006
    Location
    Parked in front of the computer when I am not working
    Posts
    12,364

    Hospice industry booms, thanks to referral bonuses

    Doesn't surprise me...... http://www.washingtonpost.com/busine...s=rss_business

    Janet Stubbs was grateful when the nursing home recommended hospice care for her aunt Midge. Although Stubbs knew her aunt wasn’t dying, the offer of free, Medicare-paid hospice visits from a nurse and chaplain, plus an extra weekly bath, was too good to pass up.

    Stubbs didn’t know that her aunt, Doris Midge Appling, was admitted to Hospice Care of Kansas during the company’s “Summer Sizzle” promotion drive, which paid employees as much as $100 a head for referrals, according to the Department of Justice. Stubbs said she had no clue that the nursing home doctor who referred her aunt for hospice moonlighted as medical director for the hospice company.

    “It doesn’t seem right,” said Stubbs, who had Appling’s power of attorney to make medical decisions. “What incentive did the doctor have to put my aunt on hospice? How much was she being paid?”

    Harden Healthcare, the hospice’s current owner, said medical directors received no incentive pay. Appling’s doctor, Donna Ewy, could not be reached for comment.

    Hospice care, once chiefly a charitable cause, has become a growth industry, with $14 billion in revenue, 1,800 for-profit providers and a base of Medicare-covered patients that doubled to 1.1 million from 2000 to 2009.

    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 a study of 1,000 pages of court documents and interviews with more than 45 hospice employees, patients and family members.

    KKR buys in

    “They wanted us to admit, admit, admit,” said Joyce White, a former marketer for Vitas Healthcare, a Chemed unit that is the nation’s largest hospice chain. “All of us competed against each other to make our numbers.”

    Publicly traded companies like Chemed and Gentiva Health Services have created hospice chains through serial takeovers. Hospice buyouts and investments by private-equity firms have also led to boosted enrollments.

    Funding from Kohlberg Kravis Roberts enabled closely-held Harden’s acquisition of Hospice Care of Kansas’s parent last year. The seller: private-equity investor Apax Partners.

    “There was always pressure to get the patient census up, any way we could, to sell the company,” said Rae Ann Angelo, a Wichita salesperson for the Kansas hospice between 2003 and 2009. “You can’t sell unless you show big growth.”

    KRG Capital Partners is another private-equity concern active in the hospice trade. KRG sold Dallas-based Trinity Hospice for $75 million in 2006. The company was liquidated by the buyer, nursing-home operator Sunrise Senior Living, two years later, after $67 million in write-offs and government allegations of ineligible patient enrollments before the takeover.

    “After KRG came in, it was clear their philosophy was, ‘Put everyone on hospice; don’t ask questions and build!’ ” said Catherine Covington, who worked as a Trinity compliance officer from 2000 to 2004. “They were there to make a buck.”

    KRG members on Trinity’s board ordered “immediate disciplinary action” when they learned of compliance violations, which led to terminations, according to Topper Ray, KRG spokesman.



  2. #2
    Super Moderator cougarnurse's Avatar
    Join Date
    Oct 2006
    Location
    Parked in front of the computer when I am not working
    Posts
    12,364
    Hospice Care of Kansas, or HCK, gave salespeople a budget of $500 a month to buy lunches and gifts for doctors and nursing-facility managers and staff, said Angelo, who now works for another hospice. Nursing homes have been offered diapers, wheelchairs, nutritional supplements and supplies in return for patient referrals, former hospice workers said.

    Vitas paid salespeople bonuses based on patients’ length of stay, according to White, who worked for the company in Cathedral City, Calif., from 1998 to 2004. Medicare, which foots 90 percent of the national hospice bill, compensates providers on a per-diem basis, and lengthier stays increase profitability, data show.

    Vitas “compensates some marketing and management representatives based on overall growth,” according to spokeswoman Kal Mistry. She said Vitas does not link compensation to length of stay or pay bonuses to employees involved in admissions decisions.

    Bonuses to doctors

    VistaCare Hospice, a unit of Atlanta-based Gentiva, paid enrollment bonuses to doctors, admissions directors and branch managers, according to Misty Wall, a former social worker for the company and now an assistant professor at Boise State University in Idaho.

    VistaCare also gave pizza parties, gift cards and other extras to its registered nurses and social workers for meeting admission targets, Wall said.

    Wall has filed a lawsuit against VistaCare in U.S. District Court in Dallas under the U.S. False Claims Act, seeking repayment to the government for admissions of ineligible hospice patients. The law lets plaintiffs share in any recoveries. The Justice Department, which has not joined Wall’s suit, is opposing VistaCare’s motion to dismiss the claim.

    The allegations predated Gentiva’s ownership of VistaCare, according to spokesman Scott Cianciulli, who said the company is committed to complying with all Medicare rules.

    The inspector general of the Health and Human Services Department is investigating hospice marketing practices and financial relationships with nursing facilities. The inquiry was prompted by a 2009 report by the Medpac commission, a congressional advisory body, that found hospices “aggressively marketed” to nursing-home patients, and paid incentives to medical directors for “inappropriate” referrals and enrollments.

    Under various federal statutes, paying for patient referrals or compensating employees based on the number of Medicare patients recruited may be illegal. But the laws are “painfully complicated” and loaded with exceptions, said Ryan Stumphauzer, a former federal prosecutor in Miami who helped launch South Florida’s Medicare Fraud Strike Force.

    He believes health-care laws bar all employees and contractors from earning bonuses based on Medicare enrollment goals, including salespeople and managers.

    Nursing-home physicians referring patients to hospices that also pay the doctors, especially in cases when the compensation includes enrollment bonuses, may violate a federal statute known as the Stark Law, Stumphauzer said. The law is designed to ensure that doctors refer patients based on who provides the best care, not based on who is paying them.


Similar Threads

  1. RN - Hospice Referral Center Supervisor
    By Aaron C. in forum Nursing Jobs [Archive]
    Replies: 0
    Last Post: 03-19-2010, 03:50 PM
  2. Replies: 0
    Last Post: 06-18-2009, 02:51 PM
  3. Ailing Hospice industry may not get care it needs
    By cougarnurse in forum Hospice-Palliative Care Nursing
    Replies: 0
    Last Post: 10-02-2008, 08:34 AM
  4. Sign on Bonuses...?
    By abu1030 in forum Nurses Talk with Nurse Recruiters
    Replies: 1
    Last Post: 10-10-2006, 11:40 AM
  5. WI-Major needs and big bonuses.
    By nursingjobs4u in forum Nurse Recruiters Talk to Nurses [Archive]
    Replies: 0
    Last Post: 05-28-2002, 11:32 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •