Fraud and Abuse uncovered within the Hospice Industry
After a Los Angeles Times investigation uncovered rampant fraud and abuse in the Hospice Industry, Legislatures are taking swift action to change laws.
A ban on new licenses, as well as changes aimed at combating rampant fraud in end-of-life care, will put a stop to decades of unrestrained development in the California hospice business on January 1, 2022. The license embargo, as well as a crackdown on bribes and patient-recruiting scams, are at the core of two proposals introduced last year in response to a Los Angeles Times investigation into the state’s expanding hospice industry. The laws were signed into law by Governor Gavin Newsom on Monday. The state auditor is also conducting a thorough investigation into hospice licensing and oversight to uncover flaws and make recommendations for changes.
“The new laws won’t stop the rampant fraud and abuse The Times exposed, but they are good first steps while the state auditor’s office conducts its investigation on the need for comprehensive reform of hospice oversight in California,” said Michael Connors, a long-term care advocate with California Advocates for Nursing Home Reform. End-of-life care, which was previously the domain of charities and religious groups, has been converted into a multibillion-dollar business dominated by profit-driven operators, according to a New York Times investigation published in December. A corridor spanning west from the San Gabriel Valley through the San Fernando Valley, which has the largest number of hospice providers in the country, has sprung dozens more hospices. There were 60 hospices in Glendale, 61 in Burbank, and 63 in Van Nuys. Each of the states of New York and Florida had less than 50.
The moratorium is linked to a full audit sought by state Sen. Ben Allen, the bill’s sponsor. “We have grave concerns that current regulations fall short of addressing the dramatic increase in the licensing of hospice care providers, some of which appear to be undermining the quality of patient care,” Allen and state Sen. Henry Stern wrote in May requesting the audit. The ban, which includes exceptions for ongoing applications and those who can demonstrate a need for a new hospice in a specific geographic region, will last for 365 days after the audit report is released, which is expected in March, according to the auditor’s office. Examine the efficacy and breadth of state systems for screening and licensing new hospice providers. A second law approved by Newsom addresses another of The Times’ primary findings, namely that fierce rivalry for new patients has produced a cottage economy of payments to shady physicians and recruiters who target potential patients at senior homes and other locations.
Patients must be confirmed as terminally ill by their attending physicians, if they have them, as well as a hospice doctor, in order to qualify for hospice.
The Times discovered that many of the people recruited by recruiters with promises of medical treatment, equipment, or housekeeping services were not dying. Some people later discovered that they had signed away their rights to life-saving emergency medical care. Assembly Bill 1280, introduced by Assemblywoman Jacqui Irwin, forbids hospice providers or their representatives from compensating recruiters or others for patient referrals. The license embargo, as well as a crackdown on bribes and patient-recruiting scams, are at the core of two proposals introduced last year in response to a Los Angeles Times investigation into the state’s expanding hospice industry.
Below is the link for the full investigation.