Play Live Radio
Next Up:
Available On Air Stations
Watch Live


Fired Nurse Files Lawsuit Against San Diego Hospice

A nurse fired by San Diego Hospice filed a whistleblower lawsuit against the end-of-life care provider, alleging the hospice routinely admitted patients who did not meet Medicare eligibility.

The suit, filed in December but unsealed earlier this week, accuses San Diego Hospice of falsifying patient records by urging nurses to be “creative” in admitting patients who had declined hospice care or were not qualified for the care under Medicare guidelines.

The suit alleges that the hospice went as far as to institute an “open access” policy in 2005, which admitted “virtually all” patients referred, even if they did not meet Medicare admission guidelines.


This activity prompted a Medicare audit, which could result in the organization being forced to return millions in Medicare benefits. In the past year, the hospice, which was once a $83 million operation, downsized staff, closed its acute-care center, moved out of its Mission Valley offices, filed for bankruptcy and eventually closed its doors.

This month, the KPBS/inewsource Investigations Desk began a series detailing the business behind hospice care and the difficulty of determining when end-of-life begins.

The suit’s plaintiff is Lori A. Rachac, a registered nurse. According to the suit, Rachac was employed by San Diego Hospice intermittently for nearly a decade. She was disciplined and later fired in January 2011, partly over disagreements with the hospice’s “philosophy of admission criteria.” In February, the hospice received notice of the audit.

Rachac filed the lawsuit under the state and federal False Claims Act, which makes illegal any fraudulent claim made to the U.S. government, including Medicare. The government can join Rachac in the suit; the U.S. Attorney’s office has yet to make a determination on whether it will. Under the act, the government can impose penalties up to $11,000 per false claim submitted, and Rachac’s suit asks for additional damages.

Rachac’s attorney, Mark Schlein, and a spokesperson for San Diego Hospice declined comment on the suit.


Hospice providers receive about $150 per day from Medicare for each of its patients. But as care gets more expensive and patients live longer, Medicare is cracking down on who can receive the benefit. Right now, Medicare supplies payments to patients who are determined to have less than six months to live, but patients can be recertified.

San Diego Hospice CEO Kathleen Pacurar told KPBS in November the Medicare audit was related to “regulatory issues.”

"Did we fill the forms out right? Did we certify when a patient was coming on, that they were eligible for the hospice benefit? Were they at the point in their terminal illness that we were the right service for them?” Pacurar said.

San Diego Hospice announced its closure earlier this month, and Scripps Health will take over patient care. Pacurar had predicted the hospice might end up repaying Medicare tens of millions of dollars in benefits for ineligible patients. There are about 20 hospice providers in San Diego County.