A for-profit hospice chain has agreed to a multi-million dollar settlement for filing false Medicare claims.

Caris Healthcare operates in Tennessee, Virginia, and South Carolina and has agreed to pay $8.5 million, according to a news release from Eastern District of Tennessee United States Attorney J. Douglas Overbey.

The settlement resolves allegations that Caris Healthcare admitted and recertified patients for hospice care that were ineligible.

The government’s complaint alleged that Caris admitted patients whose medical records did not support a terminal prognosis.

“Today’s settlement is an important reminder that compliance programs and activities cannot exist in name only. When a healthcare provider is put on notice that a patient is ineligible for a particular Medicare benefit or service, the healthcare provider cannot turn a blind eye to that information but, instead, must take reasonable steps to stop the improper conduct and to determine whether that conduct resulted in prior overpayments,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Moreover, when internal audit results or other information reveals the existence of a compliance issue that is not limited to a particular claim, as was the case here, it is incumbent on providers to exercise due diligence to determine how widespread the problem is and to return any overpayments.”

The settlement resolves allegations filed in a lawsuit by Barbara Hinkle, a registered nurse who formerly worked for Caris Healthcare, under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows the government to intervene and take over the action, as it did in this case.

The whistleblower’s share will be $1,402,500.

Caris released a statement Monday afternoon, which reads:

"Caris Healthcare announced today that it has reached a final agreement to resolve litigation brought by the U.S. Department of Justice (DOJ) in connection with a civil complaint filed by DOJ in October 2016.

Caris disputes the allegations made by DOJ in its complaint, and the settlement of the lawsuit does not involve any admission of liability or determination of any wrongdoing. Caris’ decision to enter the settlement allows Caris to avoid the cost and uncertainty of continued litigation and will enable the hospice provider to focus its resources on its mission of providing high-quality palliative end-of-life care to the thousands of patients it serves each year.

In recent years, litigation involving hospice providers has increasingly focused on the eligibility of patients to receive hospice services and often amounts to a second-guessing of the care provided to those patients, years after the fact. The settlement of the lawsuit brought under the False Claims Act (FCA) resolves these very sorts of allegations regarding care provided by Caris to a small fraction of patients between 2010 and 2013.

“Caris has the utmost confidence in its processes for determining patient eligibility for hospice and in the clinical judgment of those within our company on the frontlines of providing care to our patients,” said Norman McRae, founder and board member of Caris Healthcare.

CEO Paul Saylor thanked Caris employees for their continued dedication to the company’s mission and values.

“Caris remains committed to the highest level of compassionate care to our patients and families so that their loved ones are able to live out their final days with dignity,” Saylor said.

Under the terms of the settlement, Caris will pay the United States $8.5 million plus interest. The company, however, will not pay any statutory attorneys’ fees or expenses to the qui tam relator as part of the settlement."