Nonprofit Hospice of the Comforter to pay $3 million in Medicare fraud case

A federal judge has ordered Central Florida’s Hospice of the Comforter to pay $3 million in a Medicare fraud case spanning five years — closing an ugly chapter for the nonprofit institution.

U.S. District Judge Anne Conway this week signed an order approving the settlement and rejecting protests by the whistleblower in the case, Douglas Stone, the hospice’s former vice president of finance. Stone had argued that the institution should pay as much as $30 million, based on more than 200 potential cases of billing Medicare for patients who should not have been under hospice care.

Some of those patients — who, under Medicare rules, must be certified by a hospice physician as having six months or less to live — wound up staying for several years.

But the government limited its scope to 19 patients after its own financial analyst determined the hospice could not afford to pay more than $3 million without jeopardizing its ability to stay in business.

“We think the settlement is fair, adequate and reasonable under the circumstances,” said the hospice’s attorney, Latour “LT” Lafferty. “We look forward to moving on and focusing on our commitment to integrity and the provision of quality services to our patients.”

The settlement also bans the hospice’s former CEO, Robert Wilson, from involvement in any government health-care program for three years. Lafferty said Wilson declined to comment personally but that, at age 71, he had made “the ultimate selfless sacrifice” by not fighting the ban and allowing the matter to be settled.

For his part, Stone said he was disgusted by the outcome: “This result is so bad that I truly regret reporting the fraud. The outcome was not worth the hardship and the risk.”

Stone, 55, said he faced retaliation for standing up to a powerful, well- regarded institution, including difficulty finding another job. He has since landed an executive position with a nonprofit domestic-violence shelter in the Tampa area.

Thesettlement admits no

wrongdoing by Wilson or the hospice he helped start in 1990 — now one of the nation’s largest — nor is it a concession, federal attorneys said, that the government’s claims of fraud were unfounded.

The Department of Justice also retained the right to investigate the remainder of the cases if it deems appropriate, and the hospice must hire an independent auditor to perform annual reviews. The hospice also must notify the government is there is a pending change of ownership.

Though Stone testified that Adventist Health System, the parent company of Florida Hospital, plans to buy Hospice of the Comforter, there has been no official comment on the subject. Adventist Health has been managing daily operations of the hospice since May 2012 under a threeyear agreement.

The $3 million is to be paid with interest over the next five years.

Stone filed his initial whistleblower suit against Hospice of the Comforter in September 2011 after, he said, he tried to get Wilson and other board members to “do the right thing” and voluntarily repay Medicare for overbilling that had been discovered. Wilson, he alleged, had a financial incentive to keep such patients in hospice care because his $120,000-a-year base salary was supplemented by more than $200,000 a year in bonuses based on the hospice’s daily census.

Stone said hospice officials ultimately retaliated by firing him.

The U.S. Attorney’s Office took over the case last August.

Stone said the fraud amounted to roughly $10 million, and the law allows the government to fine the institution for triple that amount. He stood to gain a percentage of the amount recovered by the government, andis still expected to receive at least $450,000.