Not just California: A national hospice ‘Blue Book’ is needed to fight fraud

Congress has finally decided to wade into the deep waters of hospice fraud in California. That is a good thing. But what members need to know is that this problem is not new, and it is not confined to one state.

What’s more, enforcement alone will not solve it — what is desperately needed is more prevention.

Federal officials have been flagging the same patterns for years. The Department of Justice has brought cases involving sham hospice operators billing Medicare for patients who were not eligible or not receiving care at all, including prosecutions tied to large-scale fraud schemes in California and Texas.

The Centers for Medicare and Medicaid Services have repeatedly identified hospice as a program integrity risk. Medicare spends more than $25.7 billion annually on hospice care, serving roughly 1.7 million Americans each year. The exposure is national and runs into the billions. Yet the system continues to admit providers that should never have been allowed in.

Hospice fraud is often described as a problem of bad actors. It is, more accurately, a problem of inadequate design. The hospice benefit was created more than 40 years ago, when there were relatively few providers and the priority was access. The system was built for simplicity, speed and trust. Payments move quickly, and oversight comes later.

That approach worked when the market was small and easier to observe, but that world no longer exists. Today, there are more than 5,000 hospice providers nationwide, with explosive growth in certain markets. In Los Angeles County alone, there are more than 1,000 licensed hospice agencies. In some regions, provider supply has........

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