Quorum Health Group has raised eyebrows with an incentive program offering Quorum employees cash and gold coins for tips that lead to the purchase or management of a hospital.
An employee newsletter obtained by MODERN HEALTHCARE hypes awards of up to $25,000 for employees who provide information leading to a purchase, joint venture or lease option. Smaller awards are offered for leads that produce management or consulting contracts.
The newsletter urges employees of the Brentwood, Tenn.-based company to keep an eye out for "tip-offs," such as a hospital that's talking about a merger or sale or needs capital, and phone in the information promptly.
"Once the fact that a hospital is considering purchase, joint venture or lease option becomes general knowledge, it's generally too late to make a move," the newsletter said.
Parts of the newsletter read like a sweepstakes notice. An item titled "Another $2,000 winner!" relates how employee Bob Garrison's tip led to a management contract with Woodford Hospital in Versailles, Ky.
Senior and executive officers are excluded from the program, the newsletter said.
Quorum spokeswoman Shea Davis confirmed that the incentive program exists but said the newsletter was printed in the early 1990s.
Davis called it "an above-the-board incentive program to grow our business....We've had it for several years. It's been real effective." She said incentives for tips leading to a management contract range from $1,000 to $3,000, with higher awards for a hospital purchase. The company wouldn't release figures on how many awards had been given.
The program strikes some residents of Paulding County, Ohio, as unethical. Eight people there have sued Quorum to terminate its management contract with Paulding County Hospital (Jan. 1, p. 32).
"The (community) concern with the policy is that Quorum might have been brought in here for somebody's personal gain instead of to do the best thing for our hospital and our community," said Jane Nice, a reporter with the Paulding Progress newspaper who has covered the controversy.
However, Davis told MODERN HEALTHCARE that no incentive was paid in connection with the Paulding County Hospital contract.
"We don't publicly list incentives because it's not material to the company as a whole. No incentive was paid for the Paulding contract because the lead came directly from the hospital," Davis said.
She added: "We do have somebody in the organization that was raised in Paulding, but they don't have any direct involvement with the hospital whatsoever. They do not work in the part of Quorum Health Resources that oversees that management contract."
The incentive program also was the subject of an article last year in the Journal Gazette of Fort Wayne, Ind. In the article, Quorum spokeswoman Davis said that, to her knowledge, no one would receive an incentive as a result of Quorum's August 1995 purchase of Lutheran Hospital of Indiana in Fort Wayne.
