The FBI raided the homes of two hospice company owners in California on fraud and kickback allegations: Oganes Doganyan, 49, of Northridge, and Kristine Arutyunyan, 38, of Glendale. While the U.S. Department of Justice did not name the hospice company, Arutyunyan was CEO of May Light Hospice in Van Nuys, Calif., according to National Provider Identifier records.
Court documents accuse the pair of paying illegal kickbacks for hospice referrals of Medicare beneficiaries. The Justice Department indicated that Doganyan and Arutyunyan allegedly filed false hospice claims for hospice care that was medically unnecessary, ineligible for reimbursement or simply not provided, including some patients that apparently do not exist.
“Doganyan and Arutyunyan are charged with conspiracy to commit health care fraud, conspiracy to pay and receive kickbacks, and paying kickbacks,” the Justice Department said in a statement. “If convicted, Doganyan and Arutyunyan each face a maximum total penalty of 35 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.”
Arutyunyan has a stake in a number of other companies, including Holy Light Home Health, also in California, a limousine service, a surgery center, and two management companies.
The investigation involved the Justice Department’s Criminal Division, the U.S. Attorney’s Office of the Central District of California, the FBI and the U.S. Department of Health and Human Services Office of the Inspector General. The Justice Department noted that all defendants are presumed innocent until proven guilty in court.
Hospice organizations are under increasing legal and regulatory scrutiny related to medical necessity complaints under the False Claims Act and the closely related anti-kickback statute. Documentation errors and omissions, live discharges and lengths of stay beyond six months are the main red flags that could bring regulators to a hospice’s doorstep.
In January, the U.S. Department of Treasury reported that enforcement efforts had recovered more than $3 billion during the previous fiscal year from False Claims Act cases. About 2.6 billion of those dollars stemmed from lawsuits involving the health care industry, including hospice organizations.
A February report from Bass, Barry, and Sims shows that a leading cause of fraud involves hospices billing Medicare for services for which patients were not eligible. This resulted in several multi-million dollar settlements during 2020, with amounts ranging from $1 million to $5.25 million.
