David Layne, associate general counsel for Tenet Healthcare Corp., last week subjected attendees of an American Bar Association conference on healthcare fraud to a harangue about the raw deal National Medical Enterprises got from the U.S. Justice Department.
Layne was an attorney for NME in 1994 when it agreed to pay a $379 million fine to settle criminal and civil fraud charges involving its psychiatric hospitals. NME purchased American Medical International in 1995 to form Tenet. Layne is one of just a handful of NME executives still with Tenet.
Layne told the attendees of the ABA conference in San Diego of the day in August 1993 when hundreds of government agents conducted a joint raid on Dallas-based NME's corporate offices and hospitals, seizing documents and computer records that it would use later to build its case. "They treated us like criminals," he said.
After being charged with multiple counts that included illegal kickbacks and filing false Medicare cost reports, "we had to enter into an agreement with the government," he said. "It was a very irritating process for some of us to go through."
As part of NME's agreement with the Justice Department, all employees of NME-now Tenet-have to go through an annual ethics training program.
"We have to do background checks and can't hire anybody with criminal backgrounds," Layne said. "We have to rat out to the government on any individual we have a contract with that has a criminal record or an infraction."
"We worry about DFEs (disgruntled former employees) and PWBs (potential whistle blowers) reporting problems on their own."
The audience of 100 lawyers was silent after Layne finished his talk. But Timothy Terry, senior deputy attorney general in Nevada, one of the four panelists, responded: "When you look at the state and federal statutes, the compliance agreement (NME signed) is reasonable based on the criminal acts and wrongdoing."
Crossed-up Blues.From the thickets of healthcare communications comes this tale:
Several weeks ago, MODERN HEALTHCARE* revealed that Blue Cross of California, faced with a class-action sexual discrimination lawsuit, had dropped its 12-month waiting period for maternity benefits for enrollees in individual plans (April 15, p. 26).
Although Blue Cross would not comment on the issue or the suit, the information came from Blue Cross marketing materials sent to insurance brokers that advertised it was removing the exclusion effective March 1.
Following that story, a reporter for the Los Angeles Business Journal contacted Blue Cross. He reported that a spokeswoman denied Blue Cross had dropped the exclusion.
But shortly thereafter, MODERN HEALTHCARE*received a letter from Blue Cross stating: "This is in response to your interest in Blue Cross of California's policy regarding the temporary exclusion period for certain conditions."
The letter "announced" the maternity exclusion had been dropped effective March 1. "Blue Cross has a long history of responding to market needs," the letter said. "It is clear that individuals do not want this sort of temporary exclusion after they enroll. Our action to eliminate it*.*.*.*is our response to them."
Meanwhile, on May 6 the Business Journal reporter-burned but wiser-wrote: "Blue Cross of California must be congratulated for performing the type of flip-flops not likely to be seen again until the uneven parallel bar competition in Atlanta this summer." He too had obtained copies of the marketing materials and faxed copies to the Blue Cross spokeswoman. She confirmed that Blue Cross had indeed dropped its exclusion.
Label it confused.For more proof of how wasteful hospitals can be, just read the labels. "There are labels for laboratory, pharmacy, blood bank, medical records, nutritional services," said Craig Schnierow, a national-accounts executive at United Ad Label of Brea, Calif. "We have a catalog that's about two inches thick, and we carry 9,000 labels."
Schnierow says the problem isn't how many labels hospitals use; it's how they order them. Many hospitals spend as little as $125 on a single order but then spend $75 on the paperwork required to process it. The average hospital uses six to 10 suppliers and spends $125 per bed annually just for labels.
United recommends that hospitals streamline purchasing by buying from one supplier-preferably itself. The company recently won a three-year, $9 million contract to be the only label supplier for University HealthSystem Consortium, an Oak Brook, Ill.-based group purchasing program and alliance.
Wing and a prayer.A not-for-profit humanitarian relief organization based in Virginia Beach, Va., soon will be sending charity care soaring.
At a cost of more than $20 million, Operation Blessing International is retrofitting a Lockheed L-1011 wide-body jet to deliver outpatient care to needy people overseas.
Operation Blessing had been a division of the Christian Broadcasting Network, headed by television evangelist Pat Robertson, until 1993 when it became a separate not-for-profit organization.
Technicians are equipping the jet with a seating and sleeping section for 67 people, a surgical facility with three operating stations, two dental stations, a laparoscopic surgery station, and a pre- and post-operation recovery area for as many as 12 patients.
The flying hospital, to be christened May 21 by former President George Bush, will touch down for the first time in El Salvador on June 29. Trips to Panama, Ukraine and India are planned for later in the year. Paul R. Williams, M.D., senior director of international programs for Operation Blessing, said each mission will cost between $300,000 and $500,000 and will be funded primarily through donations.
Williams said about 140 doctors, nurses and other healthcare professionals are expected to make each trip. The patients will be selected at local clinics-based on need and the team's schedule-for treatment and then transported by ambulance or bus to the plane.
Williams predicted the medical teams will perform 150 to 300 surgeries during each 51/2-day stay. Among the most common procedures, he said, will be cataract removal, gallbladder surgery and plastic surgery to correct cleft palates.