Hospice focuses on the care, comfort and quality of life of a person with a serious illness who is approaching the end of life. The emotional toll of terminal conditions can be tremendous. In fact, in order to obtain hospice services under Medicare, patients must stop medical treatment intended to cure or control their illness. Unfortunately, during this difficult time, it is also common for fraudsters to prey upon these feelings to exploit their victims.
The Foundations of Hospice
Hospice principles of compassion and care for the dying have been around since the 11th century and were revived in the 1600s by the Daughters of Charity, founded in France by St. Vincent de Paul and St. Louise de Marillac. In the 1960s, a physician named
Cicely Saunders came to appreciate the unique nature of palliative care. Saunders became a driving force behind the hospice movement, and in 1982, hospice services became part of Medicare following passage of a law by Congress.
Hospice offers support for patients when a cure is not possible, instead focusing on comfort, symptom management, enhancing their quality of life and providing assistance to the family. An interdisciplinary team of professionals delivers hospice care, addressing the patient's medical, physical, spiritual and psychosocial needs, focusing on the individual rather than the illness. The team works to coordinate care and facilitate communication, including offering bereavement care after the patient's passing.
Care for Profit
Early on, most hospice agencies were non-profit organizations, often affiliated with religious groups. However, according to
2020 data, there were 5,200 hospice care agencies, more than 70% of which operated for-profit. While not all hospice agencies have issues, a 2022 report from
ProPublica detailed significant concerns and highlighted key control gaps in the industry.
Hospice News also reported on some of the initial responses from state and federal regulators, as did
Axios.
Common Hospice Fraud Schemes
Hospice can be considered a very lucrative type of health care fraud scheme. Patients and families are vulnerable, dealing with significant stress and may not be thinking clearly or be attuned to the details.
- Fraudulent Patient Enrollment: Hospice providers sometimes enroll patients who are not terminally ill — meaning they don’t meet Medicare’s criteria for hospice eligibility — to unlawfully claim reimbursement.
- Billing for Higher Levels of Care: Some providers overcharge by claiming they provided more expensive services like crisis care, even when only routine care was given.
- Incentives and Kickbacks: Illegal payments or incentives could be offered to physicians, referral agencies or nursing homes to improperly funnel patients into hospice care programs that might not be medically necessary.
- High-Pressure Marketing Tactics: Recruiters or marketers may use aggressive tactics to push vulnerable patients or families into hospice without explaining all the implications.
- Failing to Obtain Physician Certification: Medicare requires proper physician documentation certifying that a patient qualifies for hospice. Foregoing this step, or fabricating the documentation, leads to fraudulent billing practices.
- Substandard Care: Underdelivering on expected support might include poor care planning, mismanagement of hospice aide services and inadequate medical assessments of beneficiaries.
- Identity Theft of Patients: Fraudsters may use insurance or Medicare information from patients (typically stolen) and enroll them unknowingly to reap benefits and payouts for themselves.
- Identity Theft of Providers: Illicitly using physicians or other qualified healthcare professional information (e.g., National Provider Identification number) to falsely certify or recertify hospice care places even more importance on internal controls within hospice care facilities.
- Concealed Ownership: Following payment suspension or claim denials following a credible allegation of fraud, fraudsters will often close one business and open another. To conceal their involvement following a conviction and exclusion from healthcare programs, they will often employ straw owners or nominees to “paper up” the new company. See this case: Two Men Sentenced for Role in $9M Hospice Fraud Scheme.
Recent Hospice Fraud Cases
Falsifying patient conditions to make it appear that they are terminally ill, or simply signing people up without disclosing the true nature of hospice care, is fairly common. Two recent cases illustrate how deceptive these fraudsters exploit gaps under these conditions:
In June 2025, federal authorities indicted a
California nurse who ran a hospice company (in addition to her full-time job). Working with others, the nurse allegedly obtained Medicare information for the supposed hospice patients by going to retirement homes after hours. She asked them for their information to enroll them in hospice. Following inquiries by authorities, she also submitted forged doctor’s certifications.
Three women were indicted for a
hospice fraud and kickback scheme, with a loss of $110 million. Two of the women ran a hospice company, United Palliative & Hospice Company (UPHC), and allegedly deceived vulnerable older people who lived in group homes. The indictment alleges that the women lied, leading victims to believe they were receiving “palliative” or “home health services,” while being enrolled in hospice services despite the fact they were not terminally ill. Further, one of the defendants allegedly gave kickbacks to group home owners in return for enrolling their Medicare and Medicaid beneficiaries in hospice care with UPHC, as well as co-opting a local psychiatric hospital’s discharge coordinator, paying kickbacks for referrals.
Protecting Hospice for the Future
Hospice will be a critical healthcare provider over the next few years, especially as the U.S. population continues to age.
Statistics released by the National Hospice and Palliative Care Organization show that more than 1.7 million Medicare beneficiaries received at least one day or longer in hospice in the 2022 calendar year.
The focus on transparency, compliance and
integrity are going to be at the forefront for regulators, payers, families and other stakeholders. Using data analytics to identify clusters of addresses, in-depth license reviews, identifying common ownership, and drilling into shell companies and corrupt providers will likely yield results, including criminal and civil prosecution or administrative actions (including payment suspensions and exclusions), with the goal of reducing fraud and protecting patients as they near the end of their journey.
