First enacted during the Civil War, the federal False Claims Act , 31 U.S.C. § 3729 et seq., authorizes treble damages and a penalty from $5,500 to $11,000 per claim for anyone who knowingly submits or causes the submission of a false or fraudulent claim to the United States. Under the False Claims Act, whistleblowers may file lawsuits on behalf of the United States and share in any recovery.

SIDE BAR: For a detailed discussion of the False Claims Act process: Visit

As a result of information provided by whistleblowers Dawn Richardson and Marsha Brown, former employees of AseraCare Hospice, on January 23, 2012, the United States intervened and filed a Complaint against AseraCare Hospice in U.S. District Court for the Northern District of Alabama. United States ex rel. Richardson and Brown v. Golden Gate National Senior Care LLC dba Golden Living et al., No. 2:09-cv-00627 (N.D. Ala.).

SIDE BAR: Golden Gate Ancillary LLC, dba AseraCare Hospice, is a for-profit business with approximately 65 hospice providers in 19 states, including Alabama, Georgia, Pennsylvania and Wisconsin.

The Complaint alleges that AseraCare violated the False Claims Act when it misspent millions of taxpayer dollars intended for Medicare recipients who have a prognosis of six months or less to live and need hospice care.  For-profit hospice companies are entitled to receive Medicare dollars only for Medicare recipients who are terminally ill. In United States ex rel. Richardson and Brown v. Golden Gate National Senior Care LLC dba Golden Living et al , the government contends that AseraCare Hospice knowingly submitted false claims to Medicare for hospice care for patients who were not terminally ill.

Under the applicable Medicare provisions, a Medicare recipient admitted to hospice care is no longer entitled to receive services that would help to cure his or her illness. Instead, treatment is supposed to be limited to palliative care, which is aimed at relieving pain, symptoms or stress of terminal illness (including a comprehensive set of medical, social, psychological, emotional and spiritual services).  Although elderly patients may qualify for a variety of Medicare-paid services, hospice care is supposed to be limited to terminally ill patients receiving palliative care.

NOTE: The Complaint contains merely allegations and defendants are entitled to the presumption of innocence unless and until proven guilty in a court of law.