Discharge Planners Must Stop Accepting Kickbacks and Managers Must Monitor Receipt

Case managers/discharge planners have recently come under fire from fraud enforcers for violations of the federal anti-kickback statute. This statute generally prohibits anyone from either offering to give or actually giving anything to anyone in order to induce referrals. Case managers/discharge planners who violate the anti-kickback statute may be subject to criminal prosecution, which may result in prison sentences, among other consequences.


Federal Criminal Complaints were recently filed against thirty defendants in the San Francisco area who were charged in a “patients-for-cash” kickback scheme. The complaints centered on Amity Home Health Care, the largest home health care provider in the Bay Area, and Advent Care, Inc., a hospice. Under the leadership of Ridhima “Amanda” Singh, Chief Executive Officer, the federal government claims that Amity and Advent paid kickbacks to discharge planners/case managers at hospitals and social workers at skilled nursing facilities (SNFs), among others, in exchange for referrals.


The Criminal Complaints say that discharge planners/case managers in hospitals and SNFs received the following in exchange for referrals of home health and hospice patients:

·       Cash periodically delivered in envelopes

·       Gift cards ranging in value from $2,000 to $5,000

·       Handbags from Gucci, Louis Vuitton and Nordstrom

·       All-expenses-paid trips to Napa, California

These alleged payments and gifts clearly violate the federal anti-kickback statute.


Most recently, a Registered Nurse (RN) in California pled guilty to conspiring with owners of home health agencies to pay and receive illegal kickbacks in exchange for referrals of Medicare patients. The RN, who was a case manager at a nonprofit hospital, used his position as a discharge planner to steer Medicare patients to home health agencies who paid kickbacks to him.


The Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (HHS), the primary enforcer of fraud and abuse prohibitions, says that discharge planners cannot accept the following from providers who want referrals:

·       Cash

·       Cash equivalents, such as gift cards or gift certificates

·       Non-cash items of more than nominal value

·       Free discharge planning services that case managers/discharge planners are obligated to provide

The services provided by discharge planners/case managers are extremely important and are valued by many patients and their families, but the credibility and trustworthiness of discharge planners/case managers is destroyed when discharge planners/case managers make referrals based on kickbacks received.


Now a word to managers and all the way up the chain of command to CEOs. Whether or not you know that case managers/discharge planners are accepting kickbacks, the OIG may also hold you responsible. The OIG has made it clear that your job is to monitor and to be vigilant. If you knew or should have known, you may be responsible. A good starting point is to put a policy and procedure in place that requires discharge planners/case managers to report in writing anything received from post-acute providers. Or how about a policy and procedure that prohibits all gifts?!


Now a word to post-acute marketers. Don’t give kickbacks to discharge planners/case managers! It’s simply not true that you must give kickbacks in order to get referrals. The proverbial bottom line is: Do you like the color orange? Is orange your preferred fashion statement?


Please stop now!



©2020 Elizabeth E. Hogue, Esq.  All rights reserved

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