DOJ Continues to Pursue Medicare and Medicaid Fraud

The United States Department of Justice (“DOJ”) has brought another claim of Medicare fraud under the U.S. False Claims Acts. The DOJ has accused Creekside Hospice II, LLC in Las Vegas, Nevada, and Skilled Healthcare in Foothill Ranch, California, of treating non-terminally ill patients in order to gain excessive reimbursements from Medicare and Medicaid. Creekside and Skilled Healthcare are subsidiaries of Delaware corporation, SKG.1 Acting Assistant Attorney General Joyce Branda said companies often abuse Medicare’s hospice system and that “[t]he department will take swift action to protect taxpayer dollars and make sure that Medicare benefits are available to those who truly need them.”2

Under Medicare and Medicaid, “[h]ospice is available to terminally ill individuals for two initial 90-day periods, and then for an unlimited number of 60-day periods, as long as certain conditions are met.”3 To be eligible for hospice care, an individual must be medically diagnosed to have six months or less to live.

Creekside has received over $42 million during the last two years in hospice revenue, and the majority has been paid to it by Medicare. As a recipient of such revenue from the U.S. Government, Creekside is expected to understand Medicare and Medicaid hospice program requirements and to make sure its employees understand said requirements. In order to meet the Government’s requirements, the hospice provider needs a written certification that includes: “(1) a statement of individual’s medical prognosis, (2) specific clinical findings or documentation that support a diagnosis that patient has a life expectancy of six months or less; and (3) signature(s) of the physician(s) attesting to these medical conclusions.”4

The United States alleges that Creekside and Skilled Healthcare encouraged their employees to enroll patients in hospice, even when they knew the patients did not need hospice care. Allegedly, Creekside and Skilled Healthcare used aggressive marketing techniques and paid employees bonuses to increase and maintain the amount of hospice patients without regard to Medicare and Medicaid eligibility. Creekside employees falsified documents to indicate that ineligible patients were actually eligible for hospice care. Defendants also created false recertification documents to avoid having to re-evaluate patients for continued hospice care. In its complaint, the United States includes an extensive list detailing examples of patients who were purported to be terminally ill, but were actually not diagnosed as such. The U.S. also details how much money the Government lost due to Creekside’s or Skilled Healthcare’s fraud in each instance. In addition to their fraud of improperly increasing the amount of hospice patients, Creekside and Skilled Healthcare also submitted inflated claims, using “billing codes that resulted in higher payment by Medicare than were justified by the services actually performed.”5

The U.S. relies on contractors to provide adequate services to customers and to make accurate and true representations to the Government. The United States continues to pursue cases against entities that engage in fraud against Medicare and Medicaid in order to ensure that services paid for by taxpayers are properly rendered.

The legal team at SFMS has significant experience litigating false claims matters. If you have any questions regarding this subject or this posting, please contact James E. Miller ( or Michael Ols ( We can also be reached toll-free at (866) 540-5505.

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