Hospice owner charged with Medicare, Medicaid fraud
As the head of one of the fastest-growing hospice and nursing home networks in the state, Seth Gillman often talked about his mission of improving the quality of care for those in the final stages of life.
“Give patients everything they need, even that little extra that makes life worth living,” Gillman told the health care site Life Matters Media in November, citing the poor hospice care he witnessed his grandmother receive a decade ago as the inspiration for his philosophy.
But in fraud charges unveiled Monday, federal prosecutors alleged Gillman’s motives weren’t so altruistic.
As the administrator and part owner of Passages Hospice LLC, based in west suburban Lisle, Gillman orchestrated an extensive scheme to fraudulently bill Medicare and Medicaid for millions of dollars by falsifying the level of hospice care provided for patients at nursing homes he controlled throughout the state, prosecutors alleged.
According to the charges, Gillman trained nurses to look for signs that allegedly would qualify a hospice patient for general inpatient care, resulting in payments per day more than four times higher than routine care rates. In many instances, patients were not terminally ill and wound up enrolled in hospice care far longer than the required life expectancy of six months or less.
The charges alleged Gillman kept his network of regional directors in line by paying them fat bonuses based on the amount of general inpatient care they oversaw. Gillman also paid himself bonuses of more than $830,000, prosecutors alleged.
One nurse, who worked in a nursing home in downstate Belleville, told authorities her superiors explained to her that putting patients in unnecessary care was “how we get paid.” The nurse said she was told by one supervisor to “stop the Mary Poppins charting” and learn how to fake the paperwork. As a result, the nurse said she changed the charts for several patients, including falsely claiming that two patients had been injured as a result of falls, according to the charges.
In one case, Passages falsely billed Medicare for more than four years of hospice care for a patient identified as “LJ” at a cost of $192,000, according to the criminal complaint. The patient’s son told investigators that his mother appeared in no danger of dying until the last month of her life, according to prosecutors.
When other employees complained, they were often berated by Gillman, moved to another department or abruptly fired, according to the charges.
The former clinical director for Passages told federal agents that when she confronted Gillman over the eligibility of one particular patient, Gillman told her to “mind (her) own business” because he needed the money, the charges alleged.
At the company holiday party in 2008, the clinical director ignored Gillman’s request that she instruct employees on how Passages was complying with federal laws and instead passed out pamphlets about health care fraud, according to the charges. She was fired the next day.
Gillman, 45, of Lincolnwood, was charged with one count each of health care fraud and obstructing a federal audit. He was released on a $150,000 bond Monday after a brief appearance before U.S. Magistrate Judge Geraldine Soat Brown, who ordered Gillman to stay away from Passages’ daily operations while the charges are pending.
jmeisner@tribune.com
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