Northwest Georgia Hospice Provider Agrees to $1.4 Million Settlement Over Alleged Kickback Scheme

In a significant development within the healthcare sector of Northwest Georgia, Tapestry Hospice and its senior officials have agreed to pay $1.4 million to settle allegations of engaging in a kickback scheme that violated federal law. The settlement addresses claims that the hospice organization offered financial incentives to medical directors in exchange for patient referrals.

Whistleblower Sparks Investigation

The case against Tapestry Hospice originated from a whistleblower complaint filed by former employee of the hospice. The whistleblower alleged that Tapestry provided monthly stipends and signing bonuses to medical directors, with payments increasing based on the number of patient referrals. This scheme violated the Anti-Kickback Statute and resulted in the submission of false claims to federal healthcare programs.

The whistleblower’s actions exemplify the critical role that insider information can play in uncovering fraud.

Georgia Attorney General Chris Carr said that trust in end-of-life care decisions is paramount. “Decisions regarding end-of-life care are incredibly difficult and personal, and families must be able to trust the intentions of their chosen providers,” Carr commented. He also that those who manipulate the system for personal gain would face legal repercussions.

Legal and Financial Repercussions

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The settlement, approved by the U.S. District Court for the Northern District of Georgia, resolves allegations without an admission of liability by Tapestry Hospice or its officials. The investigation, conducted by the U.S. Attorney’s Office for the Northern District of Georgia, the FBI, and the Georgia Medicaid Fraud Control Unit, culminated in the substantial financial penalty aimed at deterring similar fraudulent activities in the future.

Assistant U.S. Attorney Adam D. Nugent and Georgia Assistant Attorney General Rick Tangum were instrumental in negotiating the settlement. Their efforts reflect a broader commitment within the Department of Justice and state law enforcement to ensure the integrity of federal healthcare programs.

Implications for Healthcare Providers

The Tapestry Hospice case serves as a reminder to healthcare providers about the severe consequences of engaging in illegal kickback schemes. The Anti-Kickback Statute and False Claims Act are critical tools in the fight against healthcare fraud, and enforcement agencies are poised to act against those who violate these laws.