Hospice providers continue to face increased scrutiny and enforcement actions based on allegations that beneficiaries do not meet the requisite eligibility requirements. On October 1, 2018, a United States District Court Judge in the Northern District of California granted defendant Carelink Hospice Services, Inc.’s (Carelink) motion to dismiss a qui tam action.  In her Second Amended Complaint (SAC), the relator alleged that Carelink violated the False Claims Act (FCA) based on an implied certification theory. Specifically, relator alleged, among other things, that Carelink “presented false claims and pressured its employees to maximize the number of patient admissions or eligibility re-certifications without care to whether the patients were actually eligible for Medicare-provided hospice care.” However, Carelink successfully argued that the relator’s FCA claim failed to meet the heightened pleading standard required by Federal Rule of Civil Procedure 9(b).

In granting the motion to dismiss, the court concluded that relator relied “on general allegations that Carelink presented false claims and pressured its employees to maximize the number of patient admissions or eligibility re-certifications without care to whether the patients were actually eligible for Medicare-provided hospice care.” The court further concluded that the relator had not alleged enough detail in her SAC to give notice of particular misconduct to support an implied false certification claim for hospice care under Medicare. Accordingly, the court dismissed relator’s FCA claim with prejudice.

To view the court’s order click here.