Tuesday, February 18, 2014

To Die in Texas - Dr Mahmood's Apparently Fatal Stealth Hospital System Collapses Nearly Anechoically

I would bet that most people in the US still think our health care system is highly regulated.  Some may thus conclude that the system is basically safe, because, for example, drugs have to be proven safe and effective to be approved by the government, and hospitals must be licensed and run by competent people who are thoroughly vetted.  Of course, some people still think that the US has, or had until recently, the best health care system in the world (look here).

Furthermore, the view that less regulation is always better is no quite popular in the US and elsewhere.  For example, after the chemical spill threatened water supplies in the capitol of West Virginia, the Dallas News reviewed Texas Governor Rick Perry's consistent attacks on government regulation.   

'American business in general, and American agriculture specifically, have had enough of bureaucracy at both the federal and state levels, but especially bureaucracy out of Washington,' Perry said at a congressional hearing. 'The men and women who feed and clothe this nation are suffocating under the weight of mounting federal regulations.'

That was back in 1993, when Perry was Texas’ agriculture commissioner. Now Texas’ longest-serving governor, Perry has remained steadfast in his opposition to government regulations.

Some who take such a neoliberal stance may say the health care system is over-regulated, and thus is inefficient and not innovative, leading to our high costs and poor access.

However, an amazing case out of Governor Perry's Texas that was made public last year, and I regret I just heard about recently, suggests how little health care may be regulated, and how unregulated health care, whether or not it is efficient, may be deadly.

As reported in the Dallas News, July, 2013, in the last few years there seems to have been an epidemic of quality problems in a number of seemingly unrelated small rural Texas hospitals.  The report focused first on one hospital,

Renaissance Hospital Terrell

After for-profit hospital corporation Renaissance Healthcare declared bankruptcy in 2008 (look here), it sold its hospital in Terrell, Texas to RH Terrell Management LLC owned by one Dr Tariq Mahmood.  Almost immediately, however, there was trouble.  First Edwina Henry, the quality director, spied a doctor making questionable entries in patients' charts:

from her office, she had a clear view of doctors’ foot traffic through the medical records department.

When she saw [Dr Tariq] Mahmood jotting in patient charts, she knew he wasn’t seeing patients. Mahmood himself had not been credentialed to treat patients — a process in which management vets backgrounds and competencies of doctors. Part of Henry’s job was tracking such evaluations. She also knew it was a breach of privacy laws to review patients’ medical records.

'I immediately questioned some of the clerks and [insurance billing] coders,' she said. They were deeply concerned, saying he was altering the patients’ records to help boost reimbursements for insurance claims, Henry said.

When Ms Henry complained, things did not go well,

Henry made her confidential call to the bankruptcy court in early November 2008, alleging potential fraud and threats to patient care that were eluding government notice [Ed - note that the hospital was going through bankruptcy proceedings and had just been acquired by a new owner]. The court forwarded her complaint to the U.S. Justice Department, the Texas attorney general’s office and the state health department, officials confirmed.

Later that month, the state health department sent an inspector to the hospital. However, the visit was brief, Henry said, and the inspector didn’t interview her or seek her help in obtaining records.

Williams, the health department spokeswoman, told The News her agency’s records show the inspector was unable to substantiate violations at the time.

Henry was terminated from Renaissance as part of a 'restructuring'....
Then the hospital was cited for turning patients away from the emergency department,
At Renaissance, two women in labor, one bleeding, were refused treatment. The inspection reports don’t reveal whether the women suffered complications because of the delays.

A Renaissance employee told one of the women that if she 'could stand there and have a conversation with them then (she) wasn’t about to have a baby,' reports say.

Then there were problems with infection control,

At Renaissance, no supervision over infection control could be found. For three months in the summer of 2010, no one was in charge of tracking infectious diseases or preventing their spread.

The next year, the problem was blood transfusions

Inspectors returned to Renaissance in September 2011 to investigate a botched blood transfusion procedure. They found that a registered nurse had not supervised the patient’s care. In another case, an inspector witnessed an unsupervised vocational nurse administering blood to a patient, despite no evidence that she was competent to do so — another violation.

In 2012,

During the summer, the Texas secretary of state had revoked Renaissance’s business charter for failure to pay franchise taxes.

That office didn’t share the information with the health department; it isn’t required to do so.

In September, state health regulators notified Renaissance that they were proposing a $35,050 fine for 13 violations, including the nursing supervision failures, dating as far back as 2010.

Williams, the health department spokeswoman, could not explain why the fine process took nearly two years since the first violation. 

Finally, in 2013, patients started to die,

In January of this year, when state inspectors returned to Renaissance, they found nursing supervision failures yet again.

This time, the failures had led to three deaths: All ER patients. All with severe breathing difficulties. All receiving little to no intervention as their conditions worsened.

In particular,

[Eve] McCallum sought her own care after complaining of shortness of breath during a family dinner.

McCallum had chronic obstructive pulmonary disease. When she was admitted, nurses were ordered to monitor her vital signs and oxygen levels. Her breathing soon improved, said her niece, Lou Ann Sims.

'We were fully expecting to pick her up the next morning,' Sims said.

Instead, they watched helplessly as her condition deteriorated. On Christmas Day, a physician explained to McCallum’s family that she had to be transferred to the intensive care unit.

Later, Sims witnessed a scene she can’t let go of: Her aunt lay connected to a ventilator while a nurse stood smoking a cigarette just outside the door. The nurse had propped open the door with an IV pole.

The family immediately sought to have McCallum transferred to another hospital. But hospital officials told them 'this would be a lateral move and was not allowed,' according to a transcript of an interview the family later conducted with state officials.

McCallum died two days later.

Inspectors wrote that a licensed vocational nurse had been left in charge of her treatment, without a registered nurse’s oversight. There was no evidence an RN had assessed her condition on admission or was watching over her in the ICU.

They could find no doctor orders to place her on oxygen, no order for medications administered to her, 'nor evidence of communication with the M.D.'

Suspecting more than just care breakdowns at Renaissance, McCallum’s family reported her death to the Texas attorney general’s fraud-control unit.

So partially in response to this egregious case,

By February, the state health department had moved to revoke Renaissance’s operating license, and CMS had ordered its federal funding terminated — only the ninth time nationally in the last three years CMS had taken such a step.

Even those steps could not shut down the hospital, but city officials took that last step due to the failure to pay taxes.

Other Hospitals

Dallas News reporter Miles Moffeit found several other cases of severe problems at small hospitals owned by Dr Mahmood, with at least one patient death apparently resulting, .

Shelby Regional Medical Center

This hospital was owned by Tenet Healthcare, but was sold to another of Dr Mahmood's companies, Shelby Medical Holdings, in 2007 (look here). 

In 2009, this hospital was also cited for providing insufficient treatment in the emergency department.

In 2012, things were really falling apart,

In October 2012, inspectors were at Shelby chronicling dirty, clogged air-conditioners and failures to prevent ceiling plaster 'from falling into the patient food service line and contaminating food.' Those problems put patients’ safety in 'immediate jeopardy,' they wrote.

As inspectors roamed Shelby’s halls in December, the power suddenly went out in four buildings, though not in the main hospital facility itself. The electric bill hadn’t been paid. They found other debts stacking up, too — as much as $190,442 owed to as many as 79 service providers.

Signs of neglect were everywhere. Only three of 20 patient rooms inspected were 'fully functional for patient care,' they wrote. They found holes in walls, dirty and tattered curtains, and patients complaining of heat pouring from the faulty A/C system.

Finally, in 2013, another patient died,

On Wednesday, CMS cut off federal funding to ... Shelby Regional Medical Center in Center in East Texas after regulators said a patient rushed there by ambulance never received treatment from a doctor.

The ER physician wouldn’t leave his 'sleep room,' the inspection report said, resulting in the patient’s death. Regulators also cited the hospital for failing to vet backgrounds of doctors and nurses.

Apparently soon thereafter Dr Mahmood shut the hospital down due to "legal issues that ... [he] is facing," per the Shelby Light and Champion.

Lake Whitney Medical Center

Dr Mahmood apparently purchased this hospital from a struggling local hospital authority in 2007.  

In 2009, it was cited for inadequate care in the emergency department,

At Lake Whitney, a nurse acknowledged to inspectors that she had shredded records of a patient who was denied care following a fall, according to a report. The 'patient wasn’t going to pay anyway,' the nurse was quoted as saying in the document.

In 2010, there was evidence of major infrastructure problems,

At Lake Whitney, patients were served food on rusty 'over-the-bed tables that were a source of possible infections for open wounds.' Bulging ceiling tiles exposed pipes. Pavement outside a main hospital door was 'cracked and unlevel,' putting patients at risk of injury.
As Dr Mahmood's legal troubles mounted, the hospital was sold to Frontier Hospitals Inc (look here).

Cozby-Germany Hospital 

I have been unable to discover when Dr Mahmood purchased this hospital. 

In 2010, it became apparent that the hospital was not properly licensed,

'The administrator reported the new owner had not notified (CMS) … and has not applied for hospital licensure with the state licensing agency,' a report said. [The owner] ... also was found to have appointed his own employees to the hospital’s governing board of directors, instead of independent outsiders.

And there were more severe problems with credentialing,

At Cozby-Germany hospital, hospital inspectors discovered that the chief of staff and another doctor had expired medical licenses. There were no 'functional' nurse and doctor credentialing processes, and clinical policies had not been updated since 2008, they said. The hospital pledged reforms.

But in May 2011, records show, Cozby hired one of Texas’ most notorious doctors, Rolando Arafiles.

At the time, Arafiles had been placed on probation by the medical board for allegations of harming nine patients, overbilling and improper coding at a Winkler, Texas, facility, according the board. He also was disciplined for intimidating the Winkler nurses who blew the whistle on his practices.

In November, Arafiles would be convicted of two felonies linked to the retaliation and would surrender his license.

In 2013, two local doctors purchased the hospital.

The Vanishing Owner

What made this series of cases all the more amazing is that it was really one interlinked case.  All these hospitals, plus a few more, had the same owner.  Yet no one, especially  no one in state or federal government knew that until 2013 when the facts were uncovered by Mr Moffeit.

[Dr Tariq] Mahmood, a Pakistan-trained doctor, obtained his Texas medical license in 1978. Since 2008, he has practiced medicine only at his Central Texas Hospital in Cameron, south of Waco, records with the Texas Medical Board show. Older documentation is not available.

Over the last two decades, he has purchased at least six hospital companies and two home-health care agencies, according to filings with the Texas secretary of state. He also has invested his money outside health care, acquiring the historic Hotel Lawrence in downtown Dallas, property records show.

In addition to Renaissance, Shelby and Central Texas Hospital, Mahmood owns the Lake Whitney Medical Center in Whitney and Cozby-Germany Hospital in Grand Saline. He sold Community General Hospital in Dilley around the time of his arrest in April.

The hospitals have no common corporate identity and little or no website presence, making it difficult for anyone to know they are owned by Mahmood or are part of a chain.

However, much bout Dr Mahmood was mysterious, and the deliberate cultivation of mystery might have slowed the response to this case.

Mahmood is rarely seen in the communities where his hospitals are located, say business associates and city officials. Sometimes they catch a glimpse of him passing by in a chauffeur-driven car.

'He’s almost impossible to track down' to discuss business matters, said Tom Elliott, a director for a nonprofit company that owns the hospital building in Grand Saline. 'He lets his people do the talking.'

Mahmood is a mystery to many of his own employees. He works almost entirely behind the scenes, they say, focusing largely on the business side of his operations. He often is traveling or spending time at his 10,000-square-foot gated estate in Cedar Hill, they say.

'We see him maybe once a year,' said one of his hospital physicians. 'The employees say he doesn’t like confrontation. I say he just doesn’t like to communicate. He seems to live in a different world.'


 At some point, the shadowy Dr Mahmood may have to answer for all this, at least to some extent,

In April, federal authorities charged the 62-year-old Cedar Hill resident with defrauding Medicare and Medicaid programs through $1.1 million in false billings.

Mahmood is accused of directing employees at his Central Texas Hospital in Cameron to alter underlying information in insurance claims from his other hospitals. 'In many cases,' the indictment alleges, these were 'for patients he had never seen.' Mahmood pleaded not guilty, and his attorney said he denies all charges. He has declined repeated interview requests from The Dallas Morning News

Note, however, that these are charges of financial fraud.  They do not obviously have to do with poor quality care, risks to patients' safety, or the deaths of at least three patients as discussed above.

This case was so bad that even the current Governor of Texas, Rick Perry, a politician known for taking a small government, minimal regulation stance, at least said he was going to take some action, as reported again in the Dallas News,

The governor’s office has ordered a 'deep and comprehensive look' at health care facilities owned by Dr. Tariq Mahmood, whose chain of rural Texas hospitals avoided serious regulatory action despite years of endangering patients.

The inspector general for the state Health and Human Services Commission and one of the agencies it oversees, the state health department, will conduct separate investigations, officials said Friday.

And in February, 2014, the Dallas News reported that the chief financial officer of the Dr Mahmood's stealth hospital chain was also in hot water,

The top administrator of a chain of hospitals that collapsed under the ownership of a North Texas physician faces charges that he defrauded the federal government of nearly $800,000 in stimulus funds.

Joe White of Cameron rose from maintenance man to head administrator and chief financial officer over hospitals once owned by Dr. Tariq Mahmood. Now he joins Mahmood in facing the possibility of prison time.

Like Mahmood, who pleaded not guilty, White is accused of identify theft and bilking the federal government of health care dollars. White has yet to enter a plea.

Note that the CFO and apparently COO was not even a professional generic manager.  He was a former maintenance man  and operator of a Radio Shack store.. 

Dr Mahmood has not yet come to trial.  Many questions about the case remain unanswered:
 -  Did Mahmood the only person besides his CFO cum maintenance man in charge of all this, or did he have other backers,  cronies, associates?
-  What happened to the rigorous state investigation promised by Rick Perry?
-  Given that what went on harmed patients, and hence was not just financial manipulation, are there any civil lawsuits pending?  Are there any other criminal investigations?\

Furthermore, despite its egregious nature, this case was amazingly anechoic  The only national recognition I could find was in Paul Levy's Not Running a Hospital blog.  Seven months later, I could find nothing in the national media, nothing in medical and health care literature.  Despite the amazingly poor quality of care in evidence, despite the fact that patients died, I could find no cries of outrage from those who proclaim to support quality health care or patient safety. 


Dr Mahmood and his chief operating and financial officer collectively displayed leadership that was ill-informed (the COO/ CFO was a former maintenance man), incompetent (see the egregious health quality problems listed above), self-interested (note the size of Dr Mahmood's mansion versus how little was obviously spent on his hospitals), opaque and dishonest (note how Dr Mahmood's ownership of the hospitals was obscured), and allegedly criminal.  This leadership persisted over at least eight years until it culminated in cases of apparently needless patient deaths.  

The amazing case of the stealth for-profit hospital system run by Dr Mahmood, and how its combined problems failed for so long to get systemic regulatory notice hardly suggest that our health care system is heavily regulated, or that current regulation can be relied upon to reassure patients that all is well and that the system is safe.

In fact, in the case of Dr Mahmood, government regulators did not seem to even want to know too much about hospital ownership,

Top health regulators weren’t even aware Mahmood owned several hospitals until The News sought information about them earlier this year. Regulatory agencies aren’t set up to track problem hospital owners or hold them accountable. Nor do they look for patterns of care breakdowns inside hospital chains.

'We just don’t have that authority,' said David Wright, deputy regional administrator for CMS. The federal agency oversees the state health department’s inspections of federally funded hospitals. 'We can only address problems in stand-alone facilities.'

Furthermore, it appears that modern regulators have decided to become hospital managers' and owners' best friends,

The process allows hospitals to avoid sanctions if they cooperate. Hospitals submit “corrective action plans” to remedy failures. It can take months for state regulators to bring penalties such as fines against a facility. In the case of Renaissance, it took years.

'We want to do what’s in the best interest of the patients, and our regulatory philosophy is to get hospitals into compliance,' said Carrie Williams, spokeswoman for the Texas Department of State Health Services. 'We’re not in the business of shutting down hospitals. We will give them some leeway and work with them.'

Of course, this minimalist, light touch regulatory methodology may have made some sense in an earlier era when nearly all hospitals were small community not-for-profit organizations, non-profit academic institutions, or were run by local governments.  It seems quaint, and hopelessly out of date in an era when most hospitals are part of ever larger systems, now often owned for-profit corporations, and when hospital system CEOs who are professional, and thus generic managers, not health care professionals, in an era of financialization and "maximizing shareholder value," that is, making short-term revenue the most important outcome.

Instead, the current minimalist regulatory system seems insufficient to prevent patients from dying of poor care allowed by poor leadership of health care organizations.  Much of the content of this blog has been about bad health care leadership, i.e., leadership that is ill-informed, incompetent, unsympathetic or hostile to health care professionals' values, self-interested, conflicted, dishonest, or even corrupt.  In my humble opinion, health care regulation ought to be sufficient to promote competent, caring, unconflicted, honest leadership that is accountable for putting patients' interests ahead of self-interest.  Regulation needs to be more intense, and much smarter, geared to the reality of a health care system that is now largely for-profit in an era when management dogma puts revenue ahead of all other concerns.

Maybe the deaths of some patients in Dr Mahmood's Texas hospital will finally let the air out of the mindlessly anti-regulatory bubble, and start some discussion of intelligent regulation to improve patient safety.

However, that cannot happen if this case remains anechoic.  I regret it took me so long to find it, but now I have done my part to start some echoes.  But where are the media, where are the journal editors, and where are those who so loudly proclaim their interest in patient safety and health care quality?

In particular, there are several prominent organizations that claim to promote health care quality and patient safety.  These organizations make these claims-

Joint Commission

 For more than 60 years, The Joint Commission has been a champion of patient safety by helping health care organizations to improve the quality and safety of the care they provide.

Leapfrog Group

 The Leapfrog Group is a voluntary program aimed at mobilizing employer purchasing power to alert America’s health industry that big leaps in health care safety, quality and customer value will be recognized and rewarded.

National Quality Forum

 Transforming our healthcare system to be safe, equitable, and of the highest value will take time and the work of many, but the potential rewards are great. The National Quality Forum (NQF) is a nonprofit, nonpartisan, public service organization committed to this transformation.

Robert Wood Johnson Foundation

Our efforts focus on improving both the health of everyone in America and their health care—how it's delivered, how it's paid for, and how well it does for patients and their families.

These  organizations should the ones to start the conversation about improving rather than forever shrinking regulation.   I have not heard anything from them about the deadly hospitals of Dr Mahmood.  Are they listening now?  Will we ever hear from them?  Time will tell.... 

 Note: the entire Dallas News series on the Mahmood hospitals can be found here


InformaticsMD said...

Third world medicine right here in the U.S. - stunning.

The fraudulent use of HITECH EHR stimulus funds is a nice added touch.

-- SS

Benita Blocker said...

Thanks so much for this article. I am doing my part to share and spread awareness.

Steve Lucas said...

This is not limited to medicine. I have been informed by my denomination that I have no standing and that the only way to remove an underperforming minister is through criminal charges. They will in fact, do everything in their power to prevent the removal of a minister for any reason.

The only reason they are interested in the criminal charges is so they can cover up any news coverage and distance themselves from the situation. The result is little information about minister’s failures as they are simply moved on in the system.

Steve Lucas

Anonymous said...


Thanks for the article. Quoting one line: In April, federal authorities charged the 62-year-old Cedar Hill resident with defrauding Medicare and Medicaid programs through $1.1 million in false billings.

Looks like he's qualified to come to Florida (I won't leave the light on) . . . and run for governor.


Pat said...

Why, as a country, we remain so seriously anti-regulatory boggles my mind. We have just spent years digging out of a financial crisis fueled by lack of regulation. It is not that hard to see a plethora of examples of greed gone unregulated to know that rules matter. Thanks for telling this tale of woe - health care unregulated is bad for our health. I promise to do my part by sharing the link to this post widely. Thanks for a sad story well told.

Anonymous said...

Tort reform, a legal weapon used in Texas to kill Texans without accountability, passed by Governor Rick Perry in 2003.


Cilla Mitchell

A Texas nurse and US Army vet

Anonymous said...

I am a practicing physician and sit on the Medical Board of 3 different Hospitals. The problem is not the lack of regulations but the lack of enforcement of enforcement of existing regulations. The 95% of the "good" hospitals don't need additional regulation, they are over burdened with regulations now. Regulations require more nonclinical staff and take away from patient care. Close those hospitals that don't comply not impose new burdensome regulation on those that aren't the problem.

Anonymous said...

Joint Commission is a certification the facilities would have paid for. They would not run in there and scream trouble without their request. Did you verify any of the facilities certification and their scoring? That's public info. Just FYI.

miles moffeit, Dallas Morning News said...

Addressing the two anonymous comments above: None of Mahmood's facilities were accredited. And our story highlighted several glaring weaknesses in regulations. You can access our series by Googling Collapse of Care.