Mississippi Physician Found Guilty in Hospice Fraud Scheme

Mississippi-based physician Scott Nelson, M.D., was recently found guilty of conspiracy to commit health care fraud. A federal jury convicted Nelson for his role in falsely referring and certifying patients to hospice who were not eligible to receive these services. Sentencing in the case is yet to be determined.

Nelson from 2009 to 2014 served as medical director to roughly 14 hospice providers throughout the Mississippi Delta region. During this time, hospice owners received upwards of $15 million in Medicare funds based on his inappropriate patient referrals and certifications, for which Nelson received an estimated $442,000 that the hospices paid in director fees.

“This type of fraud drives up medical costs for those who truly need care and jeopardizes our entire health care system.” said U.S. Attorney Clay Joyner. “The U.S. Attorney’s Office will continue to work with all federal, state and local partners to do everything in our power to eradicate it.”

Federal courts ruled that he illegally “robosigned” numerous medical records that allowed the hospices to bill Medicare and Medicaid for services that were not medically necessary. Additionally, hospice employees routinely transported prospective patients to Nelson’s office.

In nearly all instances, patients were not informed that they were placed on hospice care and were not aware that they were no longer eligible for curative services.

At least four of the hospice owners and employees associated with Nelson have also been convicted of health care fraud, including Sandra Livingston, former owner of Grenada Hospice, Lara Lynn Thompson, its patient recruiter, and Andre Kirkland, former owner of Cleveland Hospice, Hospice News sister site Home Health Care News reported.

“Health care fraud is not just about the dollars these medical professionals have taken, but also the trust they have violated,” said Mississippi Attorney General Lynn Fitch. “Patients put their faith in their doctors. They should not have to worry about being pawns in a get-rich-quick scheme.”

Co-defendants Charline Brandon, her son Wendell Brandon and Annette Lofton pled guilty to conspiracy to commit health care fraud for their involvement in the scheme. All were indicted in November 2017.

Charline Brandon formerly ran North Haven Hospice, Lion Hospice and North Lion Hospice in Mississippi, pleading guilty to submitting about $12 million in fraudulent claims to Medicare and nearly $3 million in Medicaid claims, according to Home Health Care News. The government also ordered Brandon to forfeit illegal gains and make restitution. The 63-year-old faced a five-year suspended prison sentence and was ordered to pay nearly $580,000 in fines, according to local media.

Assistant U.S. Attorneys Clay Dabbs and Kim Hamptom prosecuted the case. The Mississippi Attorney General’s Medicaid Fraud Control Unit conducted the investigation in concert with the U.S. Department of Health & Human Services (HHS) Office of Inspector General (OIG).

The HHS has led a multiyear state-federal investigation into hospice fraud in Mississippi. Dubbed the “Hospice Storm,” Dabbs referred to hospice fraud as a “runaway problem” in the state.

Among the factors drawing regulatory attention in Mississippi is the state’s high rate of live hospice discharges. The state in 2010 held the highest rate nationwide at 40.5% of hospice beneficiaries discharged alive within 30 days, according to a study from the National Library of Medicine.

“The guilty verdict in this case shows that our investigators and our law enforcement partners will aggressively pursue irresponsible practitioners who put their greed for profits above the well-being of their patients,” said the OIG’s Special Agent in Charge Tamala E. Miles.