On April 21, in a “Hearing on Protecting Patients and Taxpayers: Cracking down on Medicare Fraud,” the House Ways & Means Committee received testimony on hospice and home health fraud from Sheila Clark, President and Chief Executive Officer of the California Hospice and Palliative Care Association,[1] and Chris Deery, the Director of Corporate Fraud & Investigations for Independence Blue Cross.[2]
Ms. Clark’s core message to the Committee was that these frauds “are not merely billing problems” but amount to “beneficiary protection failures” that “expose vulnerable people to exploitation, deny them appropriate care, undermine trust in Medicare and, when left unchecked, distort the data and assumptions federal policymakers rely upon to oversee these benefits.” Clark argued that the evidence in this area reflects “organized, adaptive, and sophisticated schemes” that “are not consistent with isolated billing mistakes.” Clark noted that fraudulent hospice and home health providers “often do not look or operate like legitimate providers.” Clark explained:
They do not maintain real websites. Their phone numbers do not work. They do not have legitimate referral partners or relationships with hospitals and health systems. That should prompt an obvious question: how are they getting their patients?
The answer, according to Clark, “appears to be a combination of uninformed or coerced consent, stolen identifies, and payments to beneficiaries in exchange for use of Medicare numbers.” Clark further identified the “warning signs” of these fraud schemes:
The warning signs are familiar: provider clustering at common addresses, rapid enrollment growth in saturated markets, repeated use of the same medical directors or certifying physicians, invalid or unverifiable contact information, exclusive fee-for-service Medicare billing in home health in high Medicare Advantage markets, and billing patterns that diverge sharply from clinical reality.
According to Clark, these schemes allow Medicare beneficiaries to be used as “a vehicle for fraud,” “exploit the seams between licensure, certification, enrollment, survey activity, claims monitoring, and law enforcement,” and are “designed to outpace case-by-case prosecution.” Clark urged a series of policy actions:
- Strengthen front-end provider screening.
- Use existing federal authorities (like enrollment moratoria, payment suspension, enrollment revocation and other enforcement remedies) earlier, before fraudulent providers become entrenched.
- Enact a process that permits invalid hospice elections to be promptly corrected.
- Require faster and more accountable complaint handling.
- Ensure that fraud-distorted data does not influence national payment policy and quality reporting.
- Improve analytics to detect fraud at the beneficiary level “to identify serial recertifications, abnormal beneficiary movement across entities, implausibly low death rates, tranche admissions, and cycling patterns across related providers.”
- Require routine cost report auditing in hospices and home health, focusing on high-risk locations.
Mr. Deery sounded a similar warning to the Committee. Deery noted that fraud in the hospice and home health industries “diverts resources away from legitimate providers, inflates system-wide costs, and most importantly, exposes vulnerable patients to inappropriate or unnecessary care” while “undermin[ing] public trust in programs designed to support our most vulnerable members.” Deery described the tools being used at his organization to protect against fraud targeting private and public insurers, including (1) using machine learning and data analytics to support real-time monitoring of claims activity; (2) actively investigating billed services and clinical appropriateness to avoid escalation of improper payments; (3) closely collaborating with local, state and federal law enforcement; and (4) requiring fraud, waste and abuse training for all employees and key partners.
Like Clark, Deery discussed how patients are frequently “treated as vehicles for generating improper claims rather than as individuals receiving medically necessary care” and that they “are often unaware that services are being billed in their names, or that they were never clinically appropriate candidates in the first place.” Deery explained that these patients are often “targeted through deceptive telemarketing and social media campaigns, which have accelerated with the use of artificial intelligence” and that their protected health information has become “some of the most valuable data available for sale on the dark web.”
Deery also pointed out that, despite government advances in investigative techniques, Medicare payments continued to be made with “limited real time verification and still resemble a ‘pay and chase’ model that pays claims first and recovers payments later, if ever” and criminal scheme are able to “exploit delays in regulatory review, gaps between Medicare and commercial payer oversight, and the lag inherent in post-payment enforcement.” Also, “structural barriers” continue to impede effective fraud investigations, such as data sharing that remains “constrained by regulatory and operational limitations that can slow the timely exchange of actionable information.” Deery proposed the following remedial steps:
- Shifting to earlier and smarter intervention that utilizes enhanced pre-payment review and real-time utilization monitoring.
- Improved coordination across CMS, state agencies, private payers and law enforcement in sharing actionable intelligence on emerging schemes and high-risk provider networks.
- Enhanced oversight of National Provider Identifier (NPI) systems to prevent fraudulent providers from “outright identify theft of numbers found on the web, obtaining new numbers under false pretenses using fake credentials, or purchasing or transferring numbers from legitimate providers who may be unaware that they will be used for fraud.”
This recent testimony before Congress is just the latest indication of the federal government’s increased concern and focus on home health fraud as threatening the integrity of public insurance programs. Increasingly sophisticated data mining techniques using artificial intelligence, and more aggressive enforcement methods, inevitably will lead to more home health providers finding themselves in the crosshairs of government investigations. Now would be a good time, supported by counsel, to review current billing and operational protocols to ensure that your organization is in full compliance with relevant standards and regulatory requirements, and does not stand out as an outlier warranting further scrutiny.
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[1] Testimony of Sheila Clark, https://www.congress.gov/119/meeting/house/119201/witnesses/HHRG-119-WM00-Wstate-ClarkS-20260421.pdf
[2] Testimony of Chris Deery, https://waysandmeans.house.gov/wp-content/uploads/2026/04/Deery-Hearing-Statement-WM_4-21-26.pdf