Nonprofit Catholic Hospital Group Defrauds State of Millions

 Yesterday, I read multiple articles about my local community nonprofit hospital defrauding Washington State Medicaid and the federal government for millions of dollars. This hospital encouraged neurosurgeons to perform unnecessary spinal surgeries in order to generate higher revenues for five years. (Hagar, 2022)These practitioners put patient’s health at risk for financial gain. Spinal surgeries are one of the riskiest and most controversial of all procedures with a high failure rate. One of the neurosurgeons charged in this scheme earned four million dollars in one year in a rural farming community of 38,000 people. Doesn’t sound right, does it? But the head of the hospital, St. Mary’s-Providence earned ten million dollars in the same year. That to me, was mind boggling. And these doctors are not the only ones guilty of fraud in the U.S. healthcare system, which places volume ahead of health.

To give you an idea of the scale, St. Mary-Providence only has 142 beds, which is a small hospital, by comparison, Providence Hospital in Spokane has 674 beds, which is considered large by U.S. standards. The head of a much larger hospital earned less than the head of this tiny hospital, because of the Providence incentive system which rewards increased volume in complex procedures. Not comforting to know your doctor works on a lucrative bonus plan versus the best evidence-based practices.

The overbilling occurred over a five-year-period at St. Mary’s ending in 2018, when the unethical and abusive neurosurgeons were forced to resign. But Providence did not report them to the Attorney General, for that would have ensnared them in the overbilling scheme as well. The corporate financiers were content to keep raking the money in, despite patient health risks, and higher costs for all consumers.

Fortunately, the former administrator for the neuro unit became a whistleblower and got the case started with the Washington State Attorney General, Bob Ferguson’s Office. Because of the excellent work of his team, Providence has been found guilty of fraud, will pay a twenty-two million dollar fine, and will be on a five-year-probationary review. Imagine if we looked at all of Providence’s hospitals in all seven states, how much overbilling would we find? Afterall when the Affordable Care Act passed, Providence made so much money it created its own venture capital fund rather than lower its fees for services.

Providence Hospitals named in the lawsuit: Providence Centralia Hospital, Providence St. Joseph Hospital, Providence Mount Carmel Hospital, Providence Regional Medical Center, Providence St. Peter Hospital, Providence Holy Family Hospital, Providence Sacred Heart Medical Center, Providence St. Mary Medical Center, Swedish First Hill Campus, Swedish Cherry Hill Campus, Swedish Ballard Campus, Swedish Issaquah Campus, Swedish Edmonds Campus, and Kadlec Regional Medical Center. Providence also operates hospitals in Alaska, Montana, Oregon, and California.

The most galling are the finance people working in hospital corporations who create these schemes and see nothing wrong with paying someone an exorbitant compensation package in a tiny rural hospital. This is one of the problems with nonprofit hospital groups, their compensation packages are often opaque, because there are no shareholders and disclosure is limited. The executive of St. Mary Medical Center is no exception in the Providence compensation, many of their executives earn ten million a year. (National Union of Healthcare Workers, 2022) And where do these finance gurus who cut clinical staff and put patients at risk come from, Amazon and Microsoft.

Providence Health was also found guilty of deceptive billing practices, because the nonprofit hospital did not make patients aware of their charity care options. In other words, the nonprofit Catholic hospital saw nothing wrong with bilking low-income people for care, as long as their venture capital fund was doing well. (Gamble, 22)

 In a previous post, I wrote about a Pennsylvania judge ruling that another nonprofit hospital group did not deliver enough uncompensated care to qualify as a nonprofit entity. [i] This is a national healthcare problem, which can only be cured by further government interventions in regulation of pricing, financial disclosure, and enforcement.

Imagine how many more nurses and mental health specialists we could have actually helping patients if we had a healthcare system which is not based on profits. The only way this abuse is ever going to end is when Americans wake up and adopt a national healthcare system and yes, that will mean hospital administrators won’t be making ten million dollars a year. And that would be better for all of us.

And this is the healthpolicymaven signing off encouraging you not to sign blanket release forms for procedures, do stipulate that for which you agree and decline.

Roberta Winter is an independent healthcare analyst and journalist who accepts no money from any sector of the U.S. healthcare system. She has been interviewed on publicinterestpodcast.com and is the author of a guidebook to the U.S. healthcare system, published by Rowman and Littlefield in 2013. https://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

References

Gamble, M. (22, February 24). Beckers Hospital Review. Retrieved from Beckers Hospital Review.com: https://www.beckershospitalreview.com/legal-regulatory-issues/washington-sues-providence-over-collection-tactics.html

Hagar, S. (2022, April 13). More details emerge on Providence St. Mary Medical Center's $22.7 million insurance fraud settlement. Retrieved from Union Bulletin: https://www.union-bulletin.com/news/courts_and_crime/more-details-emerge-on-providence-st-mary-medical-centers-22-7-million-insurance-fraud-settlement/article_9ef81200-bab2-11ec-9bf3-03450d16ba13.html

National Union of Healthcare Workers. (2022, April 14). Providence St. Joseph Watch. Retrieved from NUHW.org: https://nuhw.org/providence-st-joseph-watch/executive-salaries/

 

 

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[i] https://healthpolicymaven.blogspot.com/2022/03/should-your-hospital-get-nonprofit.html

 

 

 

Financial Conflicts Among Nonprofit Advocacy Groups-Who Can You Trust

The battle between the drug-industry-controlled Food and Drug Administration (FDA) and the Centers for Medicare and Medicaid (CMS) over its’ decision to provide only clinical trial reimbursement for Biogen’s Aduhelm, has highlighted the tentacles of the drug development pipeline in nonprofit advocacy organizations. To refresh your memory, Aduhelm, an aducanumab drug was approved by the FDA under the emergency-fast-track-approval process, without the lengthy normal vetting process for new pharmaceuticals. Biogen’s motivation for this was profit, by capturing the market for a promising, but as yet unproven drug for Alzheimer’s. This is the proverbial pants-wetter for big pharma, like Viagra, the ubiquitous male libido enhancer with universal reimbursement. This articles reviews nonprofit organizations which participate in healthcare advocacy and their funders. Only nonprofit entities are reviewed because it is assumed all for-profit advocacy is conflicted, such as lobbyists paid by their clients. This table shows nonprofit advocacy groups, their funders, and their positions on the Aduhelm approval.

 Who Can You Trust-Who Pays For The Advice?

Organization	Funding Source	Recent Positions
American Geriatrics Society (American Geriatrics Society, 2022)	Professional fees from its 6,000 clinician members	Submitted a letter to CMS against the approval of Aducanumab for treatment of Alzheimer’s
Alliance For Aging Research (Butler, 2022)	100% funded by pharma; 50% of annual budget designated for marketing	ACT-AD-for accelerated approval of aducanumab or similar Alzheimer’s treatments
Alzheimer’s Association (Belluck, 2022)	$485,000 from Biogen in 2021, the developer of Aduhelm; 1.6 million from other drug companies; a small portion of gross annual budget	Wants aducanumab approval for all Alzheimer’s patients even those with mild symptoms, despite scant evidence it works
National Council on Aging (Cameron, 2022)	Nonprofit funded through grants and donors	Advocate for evidence-based treatments; adopted the position that Aduhelm should be used with caution in clinical trials, against accelerated approval
Pharmed Out (PharmedOut.org, 2022)	A Georgetown University advocacy group, funded through individuals and grants	Educates individuals on the medical concerns about Aduhelm, against accelerated approval; advocates for increase rigor and value analysis before approval of drugs
Right Care Alliance (Right Care Alliance, 2022)	Mostly funded by private donors, also Resist Foundation and Ben and Jerry’s	Sponsor of petition to withdraw approval of Aduhelm, against accelerated approval for drug

 Facts

The U.S. government is the largest funder of scientific research through these National Institutes of Health Agencies: National Institute on Aging, National Institute of Mental Health, National Institute of General Medical Sciences, and National Center for Advancing Translational Science. Other federal funding comes from the National Science Foundation, Veterans Administration, Food and Drug Administration, and the Center for Medicare and Medicaid Services.  This conclusion was drawn from a scientific literature review and meta-analysis conducted in 2018 (Cummings, 2018). Though drug companies do conduct their own less risky brand research, it is on the backs of early publicly funded mostly university-led research.

Significant concerns about the FDA working too closely with the drug developer Biogen have resulted in the following investigations; congressional committees, the Health and Human Services department’s inspector general, the Federal Trade Commission and the Securities and Exchange Commission.  Such concerns reflect the process by which this drug received accelerated approval despite scant evidence it works, manipulation of research data after it was rejected by the expert review at the FDA, and the director of the FDA’s personal relationship with the drug developer. A drug which had not even completed clinical trials and has been shown to kill patients was put on a direct path to market it as an Alzheimer's cure to the public. This resulted in clinical outcry, outright banning of the use of the drug by most major medical centers, and a public movement to draw attention to the concerns, as previously published.[1] [2] As a result, the independent government agency, the Centers for Medicare and Medicaid called for and received thousands of public comments on the concerns about this drug. Additionally, CMS only approved provisional payment for this drug for patients in clinical trials, which appears prudent. This decision infuriated big pharma because they assumed anything that could be hornswoggled through the FDA was a guarantee of payment by CMS, and thus, the giant wallet of the US government, which would be responsible for most of the cost.

Conclusion, since the government conducts most of the early scientific research, shouldn’t it, as the largest purchaser of pharmaceuticals, have a right to review drug approvals, for this is exactly what private insurance companies do with their pharmacy schedules. It is not in the best interest of tax paying Americans to waste money on specious treatments and CMS is doing all of us a favor by slowing down the approval of Biogen’s Aduhelm. The pharmaceutical industry should consider this a shot across the bow as the American public is awake and livid over the continual pillaging of our pocketbooks for their profits.

References

American Geriatrics Society. (2022, April 6). Where We Stand-Letter to CMS Commissioner on Aducanumab. Retrieved from https://www.americangeriatrics.org/: chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/viewer.html?pdfurl=https%3A%2F%2Fwww.americangeriatrics.org%2Fsites%2Fdefault%2Ffiles%2Finline-files%2FAmerican%2520Geriatrics%2520Society_Letter%2520to%2520FDA%2520Biogen%2520Drug%2520for%2520Alzheimer%

Belluck, P. (2022, April 6). Inside a Campaign to Get Medicare Coverage for a New Alzheimer’s Drug. Retrieved from https://www.nytimes.com/2022/04/06/health/aduhelm-alzheimers-medicare-patients.html?smid=url-share

Butler, J. (2022, April 5). The Alliance For Aging Research-Fronting For Pharma. PharmedOut.org. Retrieved April 6, 2022, from https://mailchi.mp/georgetown/april-2022-newsletter-update

Cameron, K. (2022, April 6). What you need to know about aduhelm. Retrieved from National Council on Aging: https://www.ncoa.org/article/what-you-need-to-know-about-aduhelm

Cummings, J. R. (2018, June 13). The price of progress: Funding and financing Alzheimer's disease drug development. doi:https://doi.org/10.1016/j.trci.2018.04.008

PharmedOut.org. (2022, April 6). Aduhelm. Retrieved from PharmedOut.edu: https://georgetown.edu/pharmedout/advocacy/aduhelm?authuser=0

Right Care Alliance. (2022, April 6). Withdraw Approval of Aduhelm Petition. Retrieved from Right Care Alliance: https://rightcarealliance.org/

 And this is the healthpolicymaven signing off encouraging you not to sign blanket releases when you agree to inpatient treatments, do stipulate that for which you agree and that you decline.

 

Roberta Winter is an independent healthcare analyst who accepts no money from any sector of the U.S. healthcare system. She is the author of a guidebook to the healthcare system which was published in 2013 by Rowman and Littlefield. https://healthpolicymaven.blogspot.com/2021/09/is-fda-too-politicized-to-make-sound.html

 

 

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[1] https://healthpolicymaven.blogspot.com/2022/01/high-cost-of-single-unproven-drug.html

 

[2] https://healthpolicymaven.blogspot.com/2021/09/is-fda-too-politicized-to-make-sound.html