Scamming Hospice Care for Medicare Dollars

ACORN Grift Labor Local 100 Personal Writings United Labor Unions

            Pearl River     Having navigated hospice care for my mother several years ago, I thought I had a fairly good grasp of how it worked and who benefited, but that didn’t quite prepare me for reading “Endgame:  How the Visionary Hospice Movement Became a For-Profit Hustle” in The New Yorker.  As soon as I hit the second column of this long piece and my eyes lighted on the words “Beverly Enterprises”, I knew viscerally that well was bound to be so poisoned that nothing but evil fruit would follow.

When the United Labor Unions affiliated with the Service Employees International Union in 1984, where Local 100 remained for 25 years until reconstituting the ULU and returning to its status as an independent union, SEIU and the United Food & Commercial Workers (UFCW) were involved in a joint organizing campaign targeting Beverly workers in various states. Beverly then was the largest nursing home company in the country.  The UFCW was moving in Arkansas and Mississippi, while SEIU mounted a huge campaign in Texas, populated in no small part by former ACORN organizers like Judy Graves, Doug Young and Stewart Acuff, and directed by Mark Spain, a former ACORN and ULU director.  These campaigns were their own story, but Beverly, once headquartered in Fort Smith, Arkansas, was a piece of work.  The Texas Beverly local, directed by Orell Fitzsimmons, merged into Local 100 between 1990 and 1992, when we launched out school workers organizing there under 100.

The scamming of hospice care as a money machine and private equity piggybank began in 2004 when Beverly, then the 2nd largest US nursing home chain, bought Hospice South and “folded” it into…

…one of its subsidiaries, AseraCare. Not long before the sale, Beverly had agreed to pay a five-million-dollar criminal fine and a hundred-and-seventy-five-million-dollar civil settlement after being accused of Medicare fraud. Its stock value had slumped, and Beverly’s C.E.O. had decided that expanding its empire of hospices would help the company attract steadier revenue in “high-growth, high-margin areas of healthcare services.” Less than two years later, as part of a wave of consolidations in the long-term-care industry, Beverly was sold to a private-equity firm, which rebranded it as Golden Living.

Normally the term “vulture capitalism” refers to a more general practice of bottom feeding by buying failing companies and then flipping them for a profit, but avaricious exploitation of the sick and dying would seem a more appropriate definition of the term.

The investigation by Ava Kofman is a tale of unremitting greed.  New ownership increased quotas to up admissions, since Medicare was a willing participant incentivizing the numbers in hospice to increase, then generously reimbursing operations with fewer labor costs.  People, especially in the south in places like Mississippi and Alabama, but they weren’t alone, were sometimes enrolled without their knowledge and then denied care they needed, because they were presumed to be dying, which sometimes in fact did kill them.  In other cases, they took advantage of the six-month provisions in the program to enroll, then drop, then re-enroll patients, some of whom lived for years.

A program designed with good intentions and popularized in the 1970s, became just another hustle for private equity and its wannabes.  Whistleblowers filed cases.  A judge seems to have been virtually bought to allow the fleecing to continue.  Fines were paid and the merry-go-round kept rolling.  Medicare has taken some steps to tamp down the profiteering, but the programs are popular, and no one wants to tighten down on the dying and their families, abetting the scam.  Meanwhile the vultures keep on swooping down on the sick and dying and another piece of the US healthcare system reeks of spoils and scandal.