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Press Release

Hospice to pay $1.75 million to resolve false claims act allegations

For Immediate Release
U.S. Attorney's Office, Northern District of Georgia

ATLANTA - STG Healthcare of Atlanta, Inc. (“STG Healthcare”) and two of its senior executives, Paschal “Pat” Gilley and Mathew Gilley, have agreed to pay $1.75 million to resolve allegations that STG Healthcare, operating as Interim Healthcare of Atlanta, submitted or caused the submission of false claims to Medicare and Medicaid for patients who were not eligible for the hospice benefit and that resulted from STG Healthcare’s provision of unlawful payments to a referring physician in violation of the Anti-Kickback Statutes.

“Hospice is not a blank check for unscrupulous medical providers willing to admit patients who are not terminally ill,” said U.S. Attorney Byung J. “BJay” Pak.  “It is reserved for those who truly need it.  We will also continue to prioritize cases where it appears that a medical decision, especially the decision to forego curative treatment, has been influenced by a kickback.”

“When healthcare providers put their financial interests above the needs of patients the federal funds are diverted from where they are truly needed, putting our most vulnerable citizens at risk,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “The message is clear; the FBI will not tolerate companies who file false claims to generate more corporate revenue and take advantage of programs like Medicare & Medicaid.”

“As more Americans choose hospice care, more government funding is being provided to this critical service. Unfortunately, scammers are seizing an opportunity to steal precious funding by enrolling ineligible patients in hospice care,” said Derrick Jackson, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “With our law enforcement partners, we will continue to protect patients and the programs on which they depend.”

“The hospice benefit provided by Medicaid is especially reserved for terminally ill Georgians at a critical time of transition in their care,” said Attorney General Chris Carr.  “Our office is proud to have worked alongside the U.S. Attorney’s Office for the Northern District of Georgia in this effort, and we will continue to ensure the hospice benefit is not exploited and abused by health care providers to the detriment of Georgia taxpayers.”  

The Medicare and Medicaid hospice benefit is available for patients who elect palliative treatment (medical care focused on providing patients with relief from pain, symptoms, or stress) for terminal illness and who have a life expectancy of six months or less if their illness runs its normal course.  Before billing government healthcare programs, a hospice provider must comply with Medicare and Medicaid’s requirements and ensure that patients who are foregoing curative care are in need of end-of-life care.

The government alleges that, between 2013 and 2017, STG Healthcare submitted claims for patients who were not terminally ill.  Specifically, the government contends that STG Healthcare’s business practices—setting aggressive goals for enrolling patients and failing to supervise properly the admission practices of its staff and medical directors—resulted in the submission of claims for ineligible patients.  The government also alleges that STG Healthcare submitted or caused the submission of claims to Medicare and Medicaid for services provided to individuals referred by a physician who STG Healthcare paid to be a “back up” medical director, but who did not serve as a legitimate hospice physician.

The settlement resolves allegations filed by Serita Samuel and Miranda Eskridge, former STG Healthcare employees, under the qui tam, or whistleblower, provisions of the False Claims Act, which authorizes private parties to sue for false claims on behalf of the United States and share in the recovery.  The lawsuit was filed in the Northern District of Georgia and is captioned United States and State of Georgia ex rel. Eskridge v. STG Healthcare of Atlanta, Inc. et al., No. 1:16-cv-0688-LMM (N.D. Ga.).  Ms. Samuel and Ms. Eskridge will receive a share of the settlement.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

The U.S. Attorney’s Office for the Northern District of Georgia, the FBI, the U.S. Department of Health & Human Services Office of Inspector General, and the Georgia State Attorney General’s Medicaid Fraud Division investigated this case.

The civil settlement was reached by Assistant U.S. Attorney Austin Hall and Georgia State Assistant Attorneys General Sara Vann and Rick Tangum.

For further information please contact the U.S. Attorney’s Public Affairs Office at or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is

Updated March 4, 2020

False Claims Act