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Hospice care company shutting down after owner’s indictment

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An area hospice care company with a branch in Moline is shutting down, after the indictment of its administrator and part-owner on federal fraud charges.

Passages Hospice just opened a branch in Moline late last year, but workers say they are being forced to shut the doors, even though they haven't received any kind of formal notice.

"We have not been paid for a month, we have lost our insurance. They didn't pay the premiums, so it's gone", said Ty Lyman, a regional manager for the office. "Employees went to the doctor and found out that way, they no longer have insurance," she said, as vendors were moving out inventory at the office on 35th Avenue.

"Nobody knew we were closing. Nobody knew what was going on. We were told business as usual, just last Sunday," Lyman said.

Lawyer and company administrator Seth Gillman of Lincolnwood, Illinois was indicted on January 24, 2014 on Medicare and Medicaid fraud charges. He's accused by the government of overbilling and pocketing the profits, to the tune of millions. Prosecutors allege he forced high level employees to falsify the level of hospice care provided for nursing home patients.

Nurses out of the regional office were forced to find new care for 100 dying patients.

"Now the families have to scramble and find the kind of care they need because we no longer can provide that because he's destroyed the company. We no longer have a job, and we're not a company," said hospice nurse Mary Anderson.

"It's just devastating. He's made us a part of his betrayal. I feel like we're in collusion, but we did nothing wrong," she said.

If convicted, Gillman faces up to 15 years in prison.

"He convinced me he was a good guy and now, I am furious. I'm heartbroken. I would describe him as the lowest form of life, he deserves what's coming to him," Lyman said.

Prosecutors say Passages received about $125 million in Medicaid and Medicare payments from 2006 to 2011. The indictment doesn't say how much of that was alleged fraud, but says the rate of reimbursement for the type of care was four times higher than routine care rates.

The government says Gillman would reprimand or fire whistleblowers or employees who questioned the practice.

The government says in some cases, Passages billed Medicare and Medicaid for hospice care for patients who weren't even terminally ill.

Passages had offices in Lisle, Bloomington, Rockford, Moline, Swansea and St. Louis.

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