Showing posts with label Gentiva. Show all posts
Showing posts with label Gentiva. Show all posts

Thursday, July 10, 2014

The Price of Compassion - Commercialized Hospices and the Mistreatment of Vulnerable Patients

Introduction - Commercialized Hospices

We have occasionally written about the rise of the commercialized hospice industry, and concerns that commercialized hospices may not be providing the compassionate care they promise.  As we have discussed before, the hospice movement began with small, non-profit, community based organizations meant to provide compassionate palliative care to the terminally ill.  However, in the US, the hospice movement has been co-opted by commercial hospices, often run by large corporations, which may put profit ahead of compassion.

Several long investigative articles have appeared this year that focus largely on the commercial part of the hospice movement:
Terminal neglect? - how some hospices decline to treat the dying, Washington Post, May 3, 2014, by Peter Whoriskey and Dan Keating
How dying became a multibillion-dollar industry, Huffington Post, June 19, 2014, by Ben Hallman
Is that hospice safe? - infrequent inspections mean it may be impossible to know, Washington Post, June 26, 2014, by Peter Whoriskey.

As we have discussed before, the biggest risk of the rush to commercialize hospices is that it may lead to the enrollment of patients who are not terminally ill.  To try to achieve a dignified death in as much comfort as possible, the hospice movement emphasizes aggressive use of analgesics, including narcotics, and other psychoactive drugs.  Also, hospice patients cannot expect treatments meant to prolong life or cure acute problems, since in terminal patients these may cause unpleasant side effects and will not, by definition, work.  Therefore, a patient who is not terminal enrolled in hospice runs risks of being drugged into a stupor, and could be doomed were he or she to develop an acute illness for which treatment is available, like a bacterial pneumonia that might respond to antibiotics, because in hospice antibiotics are not given for acute infections.  Thus the whole hospice model depends on the ability of hospices to enroll only terminally ill patients.

This is difficult because prognosis is difficult to predict.  Beyond that, we discussed how commercial hospices may have financial incentives to enroll patients who are not terminally ill because they can make a lot of money from such patients.

The recent articles add more evidence that commercial hospices may enroll patients who are not terminal, and such patients may end up suffering or dying prematurely because of excess pain treatment or withholding of treatment of acute illness inherent in the hospice model.

A Long Anecdote Illustrating the Dangers of Commercialized Hospices

The Huffington Post article provided an extended anecdote about what happened to a patient enrolled in a commercial hospice despite the lack of an identified terminal condition. The patient was Mary Maples.

By the fall of 2011, her health was often poor. She ate a special diet to keep her diabetes in check and likely also suffered from COPD, a disease that often afflicts ex-smokers and makes it hard to breathe. Still, she retained her wit and sense of humor

She was hospitalized briefly for a urinary tract infection. Her family felt she needed rehabilitation, but apparently had run out of eligibility for Medicare payment for it. Then somehow the family was approached by marketers for Vitas Inc, a commercial hospice company owned by Chemed, also the parent company of Roto-Rooter.

Spry doesn’t recall exactly when she first spoke to a representative from Vitas, or how the company found out that her mother might be a candidate for hospice. But Vitas staff told HuffPost that the medical director of the Titusville rehabilitation center is also on the Vitas payroll, as a team leader.

Spry said a Vitas nurse persuaded her that hospice was the correct choice for her mother. The nurse touted the at-home care and help with other chores that had grown difficult, such as bathing her mother,
Note that what the Vitas nurse allegedly emphasized were ancillary benefits of hospice, not its key function.  The implication is that at a time of vulnerability, the Vitas marketing pitch was deceptive.

It is not clear that Ms Maples or anyone with the legal power to make decisions for her understood the implications of hospice, or consented for her enrollment.

Spry signed the admission forms, even though she did not have the legal right to do so. Dunn, Maples’ grandson, actually had power of attorney over her affairs.

'I didn’t know what I was getting us into,' Spry said.

Vitas said patients or patient representatives must sign a consent form that clearly spells out the hospice mission before they can be enrolled. Records provided to HuffPost from Maples' family, obtained from Vitas, did not include this consent form.

Also,

It’s also not clear that Maples consented to hospice treatment, at least initially. She did not sign the documents authorizing her enrollment 'due to weakness,' according to Vitas records. Yet that same day, according to other nursing notes provided by her family, she was strong enough to move about using a walker during a physical therapy session. 

Enrolling the patient without her consent, or consent from a person with legal authority over her, appears to be a serious ethical failure by Vitas. 

Hospice records did not show the patient had a terminal illness.

Maples did not have a terminal illness. Her diagnosis was 'debility, unspecified,' according to her records. This is a catch-all term for frail patients that Medicare’s regulator has said hospices are no longer allowed to use, because so many claims made under the diagnosis were later rejected or determined fraudulent. 

So the patient did not have a terminal illness and did not consent to hospital enrollment, and the hospital company apparently did not make it clear that hospice is only supposed to be for terminal patients.  Furthermore, later it turned out that the family thought Ms Maples would be a candidate for resuscitation, yet hospice care is specifically not supposed to include such aggressive attempts at life prolongation.  Again, this suggests a serious failure by hospice personnel to communicate clearly at best, and perhaps outright deception.

Maples’ records show she or her family repeatedly indicated that she was full code, meaning she wanted life-saving treatment.

Nonetheless, the patient was apparently treated with narcotics and anti-psychotics even though she did not have chronic pain.  This appears to be very bad medical practice, and potentially very dangerous.

Maples was elevated to continuous care even when she wasn’t experiencing any pain at all, her records show. By doing so, Vitas boosted its daily billing rate from the standard $146.20 a day to $853.30.

Documents shared with HuffPost show that in the Melbourne office, at least, managers were encouraged to increase continuous care counts. In the fourth quarter of 2009, for example, one of four 'management program goals' was for continuous care to average 17 patients a day. Managers said they received bonuses pegged to whether they met this and other patient count targets.

The most difficult part of Maples’ experience to evaluate concerns her medication. Her records show she was given morphine, along with Ativan, a type of sedative, and Haldol, a powerful antipsychotic drug.

All three medications are contained in the 'comfort pack' that hospices ship to a patient’s house on admission. They are typically used in the final weeks of the patient’s life, when he or she is near death. 


Ultimately, Ms Maples suffered an acute event that the hospice did not apparently treat adequately.  A relative talked to her on the telephone, and found,

Her speech was garbled and she wasn’t making any sense, he recalled.

He then called the head office of the local Vitas chapter in Melbourne, Florida, and asked that his grandmother be discharged — he wanted to quit Vitas. The receptionist said Maples’ doctor was out of town, and nothing could happen until he returned the next week, according to Dunn.

Later that day, Vitas transferred Maples from her home to its inpatient unit at Courtenay Springs Nursing Home on Merritt Island.

Maples’ records indicate she was moved for 'constipation' — often a side effect of the medications she was receiving — and 'nausea.'


Then,

An ambulance brought Maples to Cape Canaveral Hospital, where she was 'unresponsive and in respiratory failure' on arrival, according to records. She was diagnosed with septic shock — a severe blood infection that is often fatal, especially in elderly patients. 

This implied that hospice personnel failed to adequately manage a potentially fatal acute problem, septic shock, extremely poor medical practice.  However, it would make no sense to aggressively treat septic shock afflicting a patient who was terminal, but, as noted above, Ms Maples did not have a terminal condition.  Although Ms Maples survived that episode, she died weeks later.

So in this one detailed case, a patient who had chronic problems but was not terminally ill was enrolled in hospice, apparently without adequate consent, and after a marketing pitch that did not seem to explain that hospice is only for terminal care.  The patient received apparently very bad medical care, including the use of narcotics for no apparent reason, and an initially inadequate response to a severe acute medical problem, probably hastening her death.  This suggests that commercialized hospices over-selling their services to the wrong patients can hurt, and sometimes even kill patients.

Overly Aggressive and Deceptive Marketing

The Huffington Post and two Washington Post articles also contained other illustrations of these problems.  In the Huffington Post article was the general observation that

Every day, hospice marketers descend on doctor’s offices, rehab centers and hospitals. These workers have been known to rifle through patient logs at nursing stations, scramble to sign up what some in the industry call 'last gasp' patients — people with just hours left to live — and even scuffle with each other in hospital corridors over the right to sign up dying people, according to current and former hospice employees and allegations made in federal lawsuits.

Such a frenzy suggests a certain lack of care about whether the targeted patients are appropriate. Furthermore, the article included specific examples of the push to enroll more patients, no matter what.  

'The pressure was direct from operations on a daily basis,' said James Robbins, a former sales manager at AseraCare Hospice, a chain operating in 19 states. 'What are you not doing? Why are we not getting more patients? We’d have constant conference calls, meetings.'

Robbins, who lives in Atlanta, said he would 'cruise' nursing home lobbies and try to pressure medical directors at those facilities to refer directly to him. 'It's not even about patient care anymore; they’ve gone to the dark side,' he said. 'It’s all about money.'

'I’m a nurse, not a saleswoman,' said Pamela Schiffman, a hospice nurse and patient case manager in California who said she has quit four jobs in the last decade because she was ordered to keep pestering families who resisted her pitch.

Note that AseraCare is a commercial hospice system owned by Golden Living, which in turn is a privately held corporation partially owned and entirely managed by Fillmore Partners, and San Francisco based private equity group (look here). 

Also, there is evidence that marketers were pushed by management to obscure the nature of hospice, and deceive patients into thinking that they would not be denied acute care should they need it.

'One huge problem I had to deal with on a daily basis is patients not understanding they were dying and truly on a real hospice,' said a former manager at a Vitas branch in Florida, who requested anonymity for fear of losing her current job in the industry. 'The admission and marketing staff would tell them, 'This is the new hospice, we are not for dying people, the rules have changed, we can just help you.'

Note that the idea that the rules have changed and hospice is not for dying people anymore is absolute nonsense. 

Furthermore, there is evidence that once enrolled, hospices may resist discharging patients even if it becomes apparent that they are not terminally ill.

A nurse who currently works for Vitas in the same Melbourne, Florida-based location that enrolled Maples said that nurses who tried to suggest at meetings that a patient was no longer appropriate for hospice were routinely 'humiliated.'

Medical Mismanagement

In the Huffington Post article, there were several anecdotes about excess use of pain medicine,

In one example described in court filings, prosecutors allege a Vitas patient was given crushed morphine, even though she wasn’t in pain. The morphine treatment continued even after the patient showed signs of having a toxic reaction to it — even seizures, prosecutors claim. 

Also,

Mary Gubacz fell into a ditch across the street from her assisted living facility at 2 a.m. after she was prescribed the powerful antipsychotic Seroquel while under care of Odyssey Hospice in Michigan, her daughter Marilyn Little said. 

Note that Odyssey hospices are one of multiple chains of hospices owned by Gentiva.


The Washington Post article, Terminal Neglect, provided data about many hospices' inability to manage worsening symptoms (but presumably mainly for patients who were terminally ill.)  In particular, it showed that many hospices never provide what is called continuous nursing care which is usually required by patients with worsening symptoms.  For example,

One of the largest such hospices in the country is the Heartland Hospice Services in Santa Rosa, Calif., a facility owned by HCR ManorCare, a company that was turned private in 2007 by the Carlyle Group, a private equity firm.

Its hospice in Santa Rosa billed Medicare in 2012 for more than 50,000 days of routine hospice care, but no patient received continuous care or general inpatient care, according to the Medicare billing records.

A spokesman for HCR ManorCare portrayed the absence of those services as a statistical anomaly.

Note that given the size of the sample, that would have to be a pretty major statistical anomaly.  

Also,

Other records, too, indicate that many hospices offer very little nursing care in the last days of life.

For example, Medicare tracks how often a hospice sends a skilled nurse to a patient in the 48 hours preceding death.  

But at about 12 percent of hospices, more than one-third of patients die without seeing a skilled nurse in the last 48 hours of their life. Indeed, at 34 hospices, no patient saw a skilled nurse during that time.

The newer Washington Post article, Is That Hospice Safe?, documented many instances of apparently inadequate care of worsening clinical problems,

A woman dying of liver cancer, battling nausea and breathing difficulties, waited weeks for someone to drain fluid from her swelling abdomen and died still waiting, according to records. Another cancer patient had a feeding tube that oozed pus where it pierced his skin and did not actually reach his stomach. He had received no fluids from it for five days, emergency room doctors said. At the same time, a patient complaining about chest pain waited two days for a recorded visit and eventually was taken to a emergency room and diagnosed with pleurisy.

Many of these problems may go unnoticed, because the article noted that hospices are inspected very infrequently, if ever, by government agencies.

Summary

The three recent articles add to the evidence that commercial hospices often enroll patients who are not terminally ill, although hospice is meant only for the terminally ill.  There may be strong incentives for hospice employees to do so, and such enrollment may be induced by deceptive marketing and not accompanied by true informed consent.  Once in hospice, many patients may get poor medical management.  Patients who are not terminally ill may be at risk of getting inadequate care, and perhaps dying due to this lack, were they to get acutely ill, since hospice is not meant to provide life prolonging or potentially curative care for acute problems.

Note that most of the examples above concern the largest commercialized hospices, owned by large publicly held corporations (Vitas owned by Chemmed and, Odyssey owned by Gentiva), or by large corporations owned by private equity (AseraCare, owned by Golden Living, run by Fillmore Partners, and HCR ManorCare, owned by Carlyle Group).  Such large and rich organizations ought to be particularly held accountable for what they are doing to vulnerable patients. 

The US is in the midst of a great, uncontrolled experiment.  We have systematically taken medical and health care services previously lead by health care professionals and sited within community non-profit organizations and given them to for-profit firms, often huge corporations.  Meanwhile, rather than increasing regulation to account for this, we have systematically deregulated health care organizations.  There is more evidence that an increasingly commercial health care system within the framework of wild West, laissez faire capitalism is expensive and dangerous.  It is particularly dangerous for vulnerable populations especially when they are unaware that their caregivers must answer to huge corporations.

In my humble opinion, we should return control of direct patient care, especially of the most vulnerable patients, to health care professionals and if necessary small non-profit community organizations.  We ought to give strong consideration to banning corporate hospices, and banning all forms of the corporate practice of medicine and corporate health care "delivery."

Given how many insiders make so much money from the current version of laissez faire capitalism in health care, however, I would expect strong resistance should such apparently "radical," but actually conservative proposals actually get any mainstream attention.    

Tuesday, March 06, 2012

Gentiva's Odyssey Healthcare Settles Again, Signs Yet Another Corporate Integrity Agreement

The Milwaukee Journal-Sentinel reported a legal settlement worth noting.  Here are the basics:
One of the nation's largest providers of hospice care has agreed to pay $25 million to settle a Medicare fraud case initiated after a former company nurse in Milwaukee filed a whistle-blower suit.

It was the second such settlement in six years for Odyssey Healthcare Inc., which paid the federal government $12.5 million in 2006 after another Wisconsin-based employee sued.

Also,
Medicare provides a benefit meant to cover hospice care for the terminally ill. It covers 24-hour in-home nursing service only during limited crisis periods. But from 2006 to 2009, Odyssey practiced a pattern of enrolling and recertifying non-terminal patients, and billing for continuous care that wasn't necessary or reasonable, according to the False Claims Act suit filed in 2008 but just unsealed Thursday.

As is usual in such cases, Odyssey's parent company denied that it did anything wrong:
Odyssey, which operates in 26 states, is now part of Atlanta-based Gentiva Health Services, which runs hospice offices in West Allis and Burlington. Gentiva officials declined to comment, but referred to an announcement it posted on its investor relations website last month.

'Gentiva cooperated fully with this investigation, which covered a period prior to our acquisition of Odyssey, and the settlement is consistent with our efforts to instill Gentiva's culture of compliance throughout the company,' said John Camperlengo, general counsel and chief compliance officer.

The statement said the firm is proud of the care its thousands of hospice clinicians provide, and of Gentiva's efforts to ensure strict compliance with all regulatory requirements.

The Implications of the Need for a New Corporate Integrity Agreement

However, there are some disturbing aspects of this case that require a bit more explanation. First, as noted by the Associated Press (in a story available here from the Dubuque [Iowa] Telegraph-Herald),
Besides agreeing to pay the $25 million settlement, Odyssey entered a five-year corporate integrity agreement with the federal government.

Now corporate integrity agreements are not known for their effectiveness. In fact, as we noted in this blog post, according to Gentiva's 2010 annual report, its Odyssey subsidiary had been subject to a corporate integrity agreement arising from its 2006 settlement, one which was apparently not effective in preventing its misbehavior from 2006 to 2009.

However, corporate integrity agreements do serve as markers for the need to improve the integrity of the corporations who need to make them. In this case, why would Gentiva be asked to sign such an agreement if its integrity were already beyond reproach? So Gentiva's current "culture of compliance" is open to question.

The Implications of "Enrolling and Recertifying Non-Terminal Patients"

A quick read of the Journal-Sentinel and Associate Press stories above might give the impression that what Odyssey did wrong involved a billing technicality, admittedly, one that allowed it to collect more money that that to which it would otherwise be entitled.

This story actually goes beyond the issue of fraud, and raises important concerns about patient care.

The enrollment  by a hospice of patients who are actually not terminally ill could have serious adverse effects on such patients. As we noted in this post, hospices are meant for patients with very limited life expectancies. The goal of hospice is to provide comfort and palliation, not active treatment of illnesses. So if patients who actually do not have such severely limited life expectancies are admitted to a hospice, they might be denied therapy that could actually make them feel better, or even cure acute illnesses or prolong their lives. For example, a hospice patient who developed an open wound might not get maximal wound therapy, as in an example (allegedly involving a different commercial hospice provider) in the post above.

So it is possible that Odyssey's enrolling and re-certifying of non-terminally ill patients could have lead to failure to provide some of these patients with the care they should have had. Whether this did or did not occur in individual cases, and what adverse effects may have been produced is not clear from the coverage of this case.  

Summary

As I wrote in 2011, .... There has been a lot of blather from politicians in the US about "death panels" in debates about health care reform. Many such politicians seem worried that the US government has or will have death panels under the new health care reform legislation. We have criticized that legislation for not addressing many important health care problems. No one, however, has convincingly demonstrated how its provisions would convene "death panels."


Wendell Potter argued in his book, Deadly Spin, (see this post) that for-profit insurance companies had their own "death panels." The Bloomberg article strongly suggests that for-profit hospices may also act like death panels. In search of more revenue, for-profit hospices may enroll patients who are not at the end of life, but then provide them only "comfort care," so that if they develop new conditions that are treatable, they are likely to die in the absence of treatment.

I am waiting for the politicians who so enthusiastically condemned the supposed "death panels" to be found in health care reform legislation to condemn for-profit hospices for behaving like death panels.

In my humble opinion, the case discussed above are the strongest argument yet that we need to reconsider our headlong rush to turn health care, particularly the direct care of patients, over to relatively unregulated, for-profit corporations. The cases above suggest that the pursuit of revenue ahead of patients' welfare by such organizations may lead to sick and dead patients.

I cannot see how for-profit direct patient care can be made safe for patients without intense government regulation. If any of those vocal advocates of "free market" health care (in the absence of any good explanation of how health care can ever be an ideal free market, see this post) can explain to me how for-profit hospices can be made safe for patients without such regulation, I would welcome their attempts.

Meanwhile, this just calls out for legislative and legal investigation, and urgent policy changes.
 
By the way, the case above also shows how the current approach used by the government to address misbehavior in health care does not work.  We have noted previously how these legal settlements often only lead to financial penalties imposed on companies, not individuals, which diffuses their impact, and provides no disincentives to future bad behavior by individuals.  Sometimes corporate integrity agreements are added, but as in the current case, they also seem not to deter future bad behavior.   So, I further conclude, de rigueur, to really deter bad behavior, those who authorized, directed or implemented bad behavior must be held accountable. As long as they are not, expect the bad behavior to continue. Real health care reform needs to make health care leaders accountable, and especially accountable for the bad behavior that helped make them rich.

Thursday, July 28, 2011

Executives Get Rich Despite Ethical and Legal Questions about For-Profit Hospices

We recently posted about some shocking allegations suggesting that the for-profit corporations that now dominate hospice care may prey on vulnerable patients to increase their revenues, and may specifically recruit patients who are not terminally ill for hospice, and then neglect to attend to their treatable medical problems.  The post was based on a Bloomberg investigative report.

The Bloomberg report focused on two large for-profit hospice providers, Vitas, a subsidiary of Chemed, and VistaCare, a subsidiary of Gentiva. We have repeatedly seen a pattern in numerous other health care organizations, non-profit as well as for-profit: despite questionable corporate behavior that appears to violate the values of health care professionals, executives receive rich compensation overseen by complacent corporate stewards. So, using publicly available information, I compared and contrasted the two for-profit hospice corporations' health care missions, behavior with respect to core values, executive compensation, and board composition.

Stated Mission

Chemed (including Vitas Hospice Care)

Vitas Mission and Values
VITAS Values
Patients and families come first.
We take care of each other.
I’ll do my best today and do even better tomorrow.
I am proud to make a difference.

VITAS Mission
We are a growing family of hospices providing the highest quality human services, products and case management to terminally ill and other appropriate patients and their families with measurable advantages for the patient, the family, the medical community, the employee and the stockholder.

Gentiva (including VistaCare, part of Odyssey Healthcare)

Gentiva's "about us" web page declares:
We are committed to clinical excellence and determined to continually raise the bar in home healthcare by setting new industry standards for quality care and personalized service. That’s why thousands of patients every day choose us for their home healthcare needs.

Gentiva's hospice website declares:
Our hospice services allow patients to make the most of each day, at home surrounded by friends and family in a familiar, comfortable environment. Because at Gentiva, we believe that every moment matters.

So both organizations affirmed "warm and fuzzy" commitments to put patients first and to quality of care.

Behavior

Chemmed

The Bloomberg article noted that the Vitas subsidiary of Chemed is being sued for elder abuse and wrongful death based on allegations that the company put a patient who did not appear to be terminally ill in hospice care, and then failed to adequately treat the infection that appeared to eventually cause her death.

In addition, the 2010 Chemed Annual Report noted that the company is now the subject of two ongoing investigations.

The first involves:
In May 2009, VITAS received an administrative subpoena from the U.S. Department of Justice requesting VITAS deliver to the OIG documents, patient records, and policy and procedure manuals for headquarters and its Texas programs concerning hospice services provided for the period January 1, 2003 to the date of the letter.

In addition,
In February 2010, VITAS received a companion civil investigative demand ('CID') from the state of Texas Attorney General’s Office, seeking related documents. In September 2010, it received a second CID and a second administrative subpoena seeking related documents.

The second involves:
In April 2005, the Office of Inspector General ('OIG') for the Department of Health and Human Services served VITAS with civil subpoenas relating to VITAS’ alleged failure to appropriately bill Medicare and Medicaid for hospice services.

This is still active,
In March 2009, we received a letter from the government reiterating the basis of their investigation.

Gentiva

The Bloomberg article noted that VistaCare, part of Odyssey Healthcare, which is a Gentiva subsidiary, is being sued by a former employee who alleged that her job was to entice patients who did not have terminal conditions into hospice, and that the company used other unethical tactics to enroll more patients.

Also, according to the 2010 Gentiva Annual Report, the company's Odyssey subsidiary is currently operating under a corporate integrity agreement:
On July 6, 2006, Odyssey entered into a five-year Corporate Integrity Agreement (“CIA”) with the Office of Inspector General of Health and Human Services. The CIA imposes certain auditing, self-reporting and training requirements that Odyssey must comply with. If Odyssey fails to comply with the terms of its CIA, it could subject us to substantial monetary penalties and/or suspension or termination from participation in the Medicare and Medicaid programs.

There are also numerous ongoing investigations and regulatory actions ongoing, including:
On February 14, 2008, Odyssey received a letter from the Medicaid Fraud Control Unit of the Texas Attorney General’s office notifying Odyssey that the Texas Attorney General was conducting an investigation concerning Medicaid hospice services provided by Odyssey, including its practices with respect to patient admission and retention, and requesting medical records of approximately 50 patients served by its programs in the State of Texas.

Also,
On May 5, 2008, Odyssey received a letter from the DOJ notifying Odyssey that the DOJ was conducting an investigation of VistaCare, Inc. ('VistaCare') and requesting that Odyssey provide certain information and documents related to the DOJ’s investigation of claims submitted by VistaCare to Medicare, Medicaid and TRICARE, from January 1, 2003 through March 6, 2008, the date Odyssey completed the acquisition of VistaCare. Odyssey has been informed by the DOJ and the Medicaid Fraud Control Unit of the Texas Attorney General’s Office that they are reviewing allegations that VistaCare may have billed the federal Medicare, Medicaid and TRICARE programs for hospice services that were not reasonably or medically necessary or performed as claimed. The basis of the investigation is a qui tam lawsuit filed in the United States District Court for the Northern District of Texas by a former employee of VistaCare. The lawsuit was unsealed on October 5, 2009 and served on Odyssey on January 28, 2010. In connection with the unsealing of the complaint, the DOJ filed a notice with the court declining to intervene in the qui tam action at this time. The Texas Attorney General also filed a notice of non-intervention with the court. These actions should not be viewed as a final assessment by the DOJ or the Texas Attorney General of the merits of this qui tam action.

Also,
On January 5, 2009, Odyssey received a letter from the Georgia State Health Care Fraud Control Unit notifying Odyssey that the Georgia State Health Care Fraud Control Unit was conducting an investigation concerning Medicaid hospice services provided by VistaCare from 2003 through 2007 and requesting certain documents

Also,
On February 2, 2009, Odyssey received a subpoena from the OIG requesting certain documents related to Odyssey’s provision of continuous care services from January 1, 2004 through February 2, 2009. On September 9, 2009, Odyssey received a second subpoena from the OIG requesting medical records for certain patients who had been provided continuous care services by Odyssey during the same time period.

Also,
On February 23, 2010, Odyssey received a subpoena from the OIG requesting various documents and certain patient records of one of Odyssey’s hospice programs relating to services performed from January 1, 2006 through December 31, 2009.

Also,
In April 2003, the Company received a subpoena from the OIG. The subpoena sought information regarding the Company’s implementation of settlements and corporate integrity agreements entered into with the government, as well as the Company’s treatment on cost reports of employees engaged in sales and marketing efforts. In February 2004, the Company received a subpoena from the U.S. Department of Justice ('DOJ') seeking additional information related to the matters covered by the OIG subpoena. In early May 2010, the Company reached an agreement in principle, subject to final approvals, with the government to resolve this matter. Under the agreement, the Company will pay the government $12.5 million, of which $9.5 million was recorded as a charge in 2010 with the remaining $3 million covered by a previously-recorded reserve.

Also,
On July 13, 2010, the SEC informed the Company that the SEC had commenced an investigation relating to the Company’s participation in the Medicare Home Health Prospective Payment System, and, on July 16, 2010, the Company received a subpoena from the SEC requesting certain documents in connection with its investigation. Similar to the Senate Finance Committee request, the SEC subpoena, among other things, focused on issues related to the number of and reimbursement received for therapy visits before and after changes in the Medicare reimbursement system, relationships with physicians, compliance efforts including compliance with fraud and abuse laws, and certain documents sent to the Senate Finance Committee.
In addition to the allegations detailed by the Bloomberg article, there are an impressive number of investigations going on.  In addition, Gentiva has already recently settled apparently two different legal actions.  Thus, many questions have been raised about the companies' ethics, and the extent that they really uphold the warm and fuzzy values portrayed by their marketing.

Executive Compensation and Board Composition

Chemed

Based on the 2011 Chemed proxy statement, the company CEO, K J McNamara, got $5,848,230 total compensation in 2010. The four other most highly paid executives got from just over $1 million to over $2.5 million. Mr McNamara's compensation included over $150,000 for use of company aircraft. Other executives had use of the aircraft, of a company apartment, and of a company car, and company paid golf club memberships, and one got over $64,000 in housing costs. None apparently has any background in direct health care.

Of the "independent" directors, one, Andrea R Lindell, is now the retired Dean and Professor of the College of Nursing at the University of Cincinnati, and retired Associate Senior Vice President of the Medical Center. She retired in 2011, but has been director of Chemed since 2008. None of other directors apparently has any direct health care background. They include five who are currently or were formerly in financial services, and one attorney. The majority hold or held executive positions at least at the Senior Vice President level for a variety of organizations.The independent directors generally got somewhat over $100,000 in compensation in 2010.

Gentiva

Based on the 2011 Gentiva proxy statement, the company CEO, Tony Strange, got $5,472,327 in total compensation in 2010.  Three senior vice presidents and "C" level officers got over $1.3, $2.1, and $3.1 million respectively.  One, the Chief Clinical Officer, has a nursing diploma and nursing experience (see management biographies here.)  No others have apparent experience in direct clinical care.

Of the "independent" directors, one, Dr Sheldon M Retchin, is a physician, and is now CEO of the Virginia Commonwealth University Health System and Vice-President for Health Sciences at Virginia Commonwealth University.  None of other independent directors apparently has any direct health care background. The majority hold or held chief executive positions at a variety of different kinds of firms. The independent directors generally got somewhat over $145,000 in compensation in 2010.

Thus, despite the fact that the two companies provide direct clinical care to the most vulnerable of patients, their top leadership has very little background in direct patient care.  Only two directors, one of each company, are involved in health care, but their involvement may involved conflicts of interest.  Despite the apparent contrast between the companies' high-minded missions and the ethical questions besetting them, their top executives are compensated at a level sufficient to make them quite wealthy.

Summary

The pattern repeats again.  Not only has the compensation given to health care leaders got so large that it is per se a cause of increased health spending, but also, and more importantly, such compensation often provides perverse incentives that perpetuate mismanagement, raising costs and lowering quality. This situation appears to be enabled by governance by individuals who are often fellow members of the CEOs' club, and hence who may feel more sympathy with the executives they are supposed to supervise than the stockholders whose financial interests they are supposed to protect, or the public whom the companies' products and services are supposed to benefit. Moreover, these individuals often have conflicts of interest which may mitigate against objective scrutiny of the executives they are supposed to oversee. Finally, these individuals often may come from corporate cultures which do not espouse the values that we in health care are supposed to uphold. (See this post and its links for other examples of the sorts of people who are supposed to provide stewardship to health care organizations.)


So to reiterate-

I strongly believe that there needs to be much more investigation, academic, journalistic, and perhaps legal, of the identity, nature, and culture of the leaders of health care, and their relationships. A few bloggers cannot do it all. Obviously, the anechoic effect mitigates against medical and health care academics looking into their own leaders. However, failing to understand who is leading our march to the brink of health care failure ought not to be something such academics would want on their conscience.

Finally, and obviously, health care organizations need leaders that uphold the core values of health care, and focus on and are accountable for the mission, not on secondary responsibilities that conflict with these values and their mission, and not on self-enrichment. Leaders ought to be rewarded reasonably, but not lavishly, for doing what ultimately improves patient care, or when applicable, good education and good research.

If we do not fix the severe problems affecting the leadership and governance of health care, and do not increase accountability, integrity and transparency of health care leadership and governance, we will be as much to blame as the leaders when the system collapses.

Friday, February 13, 2009

What, The RUC, Again? - One of the World's Most Prominent Medical Journals Also Leaves Some Important Things Out

With health care reform continuing as a hot topic in the US, more discussions of issues of interest to Health Care Renewal are appearing. We previously posted about a prominent expert's discussion of how the US Medicare system pays physicians. We noted that he seemed to avoid critical issues, and thus may have failed to suggest changes that would address the real problems. Finally, we noted that his undisclosed financial relationships with several companies which have profited from the status quo may have affected his arguments, and failure to disclose these apparent conflicts of interest muddied the discussion.

In a similar vein, we will discuss an article just published entitled "Reforming Medicare's Physician Payment System," by Gail R Wilensky, PhD(1). [Note that the discussion will be formatted in the same manner as the previous post, and we will unashamedly borrow some language from that post.]

Ms Wilensky's summary of the main problems afflicting the payment system was:

Medicare originally based its reimbursement to physicians, like all its reimbursements, on the amounts that had historically been charged for particular health care services. In 1984, when the program moved away from a charge-based per-diem rate for hospitals, it introduced the use of the Medicare Economic Index — a measure of the annual change that physicians face in the costs of practice — for updating physicians' reimbursement. This change marked the start of an increasing divergence between Medicare's reimbursement of physicians and its reimbursement of other providers.

In general, however, physicians are paid for providing discrete services, according to a disaggregated fee schedule that uses more than 7000 billing codes. In 1989, a major change was made in physician payments: the disaggregated fee schedule based on historical charges was replaced with the Resource-Based Relative Value Scale, which is based on relative values for physicians' work effort, physicians' practice expenses, and malpractice liability insurance expenses. Although the scale was intended to correct for a historical undervaluing of primary care and overvaluing of procedures (which it does not appear to have done very successfully) and for larger differences between urban and rural reimbursements than could be justified by differences in the costs of practice, it retained the use of a largely disaggregated fee schedule.

Because the risk of inappropriate volume increases is much greater with a disaggregated billing system, as the experiences of the 1980s showed, updates to the fee schedule have followed a top-down strategy. Since the early 1990s, overall Medicare spending has been tied to a preset target — initially to the volume performance standard (an amount that was set into law each year) and now, through the sustainable growth rate (SGR), to the rate of growth in the economy. Fees are adjusted whenever overall spending is greater (or less) than the target level....

Most recent discussion of reforming physician payment has focused on the SGR, which has caused the pressure to lower physicians' fees.


Her main solution to these problems:


I believe the key to reforming physician payment is to develop a more aggregative payment strategy. In the near term, payments need to be developed that cover all the services that a single physician provides to a patient for the treatment of one or more chronic diseases. This approach is consistent with, and could be related to, the work that CMS and others are doing on medical homes. In addition, bundled payments should be developed for high-cost, high-volume DRGs, to include, at a minimum, the reimbursement for all physician services associated with the DRG and perhaps the hospital payment as well.

Ms Wilensky suggested the main problem with Medicare's current system for paying physicians is that the sustainable growth rate (SGR) forces reductions in physicians' fees whenever total payments to physicians grow faster than the optimal rate. However, she avoids discussing why those payments grow so fast.

Increases in Fees Paid for and Volume of Procedures

As we have discussed, the current system pays physicians much more to do procedures than provide "cognitive" services, and these discrepancies are increasing over time. The amounts it pays for particular procedures are frequently raised. Meanwhile, physicians increase the number of procedures they do, partially because they find ways to do procedures faster. Thus, the amount being paid for procedures increases rapidly over time. But then the SGR mechanism is used to cut fees across the board, including those for cognitive services, which did not contribute to the overall increase in costs.

Why does Medicare continue to behave seemingly so irrationally? As we have discussed before, it seems to do with the machinations of the shadowy RUC (RBRVS Update Committee).

The Shadowy RUC

As we have discussed, the US Medicare system determines what it pays physicians using the Resource Based Relative Value System (RBRVS). This system determines the pay for every kind of medical encounter according to a complex formula that is supposed to account for physicians' time and effort, physicians' practice expense, and the cost of malpractice insurance. The components of physicians' effort assessed are, in turn, technical skill and physical effort; the required mental effort and judgment; and stress due to the potential risk to the patient.

To keep the system, which was started in 1990, current, requires addition of new kinds of encounters, which means encounters involving new kinds of procedures, and updating of the estimates of various components, including physicians' time and effort. To do so, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee (RUC). The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are secret, as are the proceedings of the group.

This opaque and unaccountable process has resulted in increases outstripping inflation in fees paid for procedures, while fees paid for "cognitive"medicine, i.e., for primary care, and for services that involve diagnosis, management of acute and chronic disease, counseling, coordination of care, etc, but not procedures, have lagged inflation. The effects of the RUC have been amplified by the unexplained tendency of commercial managed care and health insurance to track the RBRVS system when making their own payments to physicians.

For further details about the RUC, see these posts on Health Care Renewal (here, here, here, here, and here) and important articles by Bodenheimer et al,(2) and Goodson.(3)

By the way, why the US Center for Medicare and Medicaid Services (CMS) relies de facto exclusively on the RUC to control the RBRVS system, and why the AMA made the RUC into a secret organization apparently beholden only to the organization's proceduralist members are unanswered questions.


What Wilensky Left Out, and Why?

Ms Wilensky, a distinguished health care policy expert, barely touched on the biggest problems with how the US fee-for-service payment system works, and why these problems occurred. Thus, it is not surprising that the few solutions she recommended seem irrelevant to these problems.

As an aside, her discussion is not atypical of what is seen in most writings about health care policy that have to do with costs. It appears that it is politically incorrect to say that incentives are skewed, that this skewing appears to have resulted from the acts of a few individuals, and that these acts occurred with little outside attention or accountability. Why do health care policy experts follow these dictates of political correctness?

I don't know, but one possible explanation is that they are themselves biased by their own incentives. So let us further consider the case of Ms Wilensky.

Ms Wilensky's Conflicts of Interest

The New England Journal of Medicine article identified Ms Wilensky as "a senior fellow at Project HOPE, Bethesda, MD, a former administrator of the Health Care Financing Administration (now the CMS), and a former chair of MedPAC." It also noted, "no potential conflict of interest relevant to this article was reported."

So it did not acknowledge the following relationships:

- Ms Wilensky is a member of the board of directors of Cephalon, which claims to be "one of the world’s top ten biopharmaceutical companies." According to the 2008 company proxy statement, her total compensation for this position was $347,395 in 2007, and she owned 65,000 shares of Cephalon stock or equivalent.
- Ms Wilensky is a member of the board of directors of Gentiva, which claims to be "the nation's leading provider of comprehensive home healthcare and related services." According to the 2008 company proxy statement, her total compensation for this position was $125,031 in 2007, and she owned 33,205 shares of Gentiva stock or equivalent.
- Ms Wilensky is a member of the board of directors of Quest Diagnostics Company, which claims to be "the world’s leader in diagnostic testing, information, and services." According to the 2008 company proxy statement, here total compensation for this position was $291,112 in 2007, and she owned 122, 224 shares of Quest stock or equivalent.
- Ms Wilensky is a member of the board of directors of SRA International, a multi-purpose consulting company which "provides health consulting services for global clients, both public and private." SRA International also has a subsidiary, SRA "Global Clinical Development [which] is a full-service, global CRO [contract research organization]" providing services to pharmaceutical, biotechnology and device companies. According to the 2008 company proxy statement, her total compensation for this position was $179,659 in 2007, and she owned 20,000 shares of SRA stock or equivalent.
- Ms Wiilensky is a member of the board of directors of the UnitedHealth Group, one of the largest US health care insurers/ managed care organizations. According to the 2008 company proxy statement, her total compensation for this postion was $322,591 in 2007, and she owned 312,560 shares of UnitedHealth stock or equivalent.

All these corporations benefit from how the health care system currently runs. In particular, our current procedure-heavy style of medicine, driven by the incentives dictated by the RUC, favors the extensive use of expensive pharmaceuticals, laboratory tests and devices. The companies Cephalon, Quest Diagnostics, and SRA International thus especially benefit from this style. As a member of the boards of these companies, Ms Wilensky has a duty to advance their financial performance. Thus, it seems that Ms Wilensky's legal responsibilities to these companies might tend to bias her against actively questioning how physicians are currently paid, or proposing solutions that might upset the status quo.

Ms Wilensky's leadership roles in US publicly traded corporations are public, but not easily found unless one knows where to look. (A previous post on Health Care Renewal did document Ms Wilensky's board relationships at the time, 2006, as they related to a report she helped author on pay-for-performance [P4P]). However, the New England Journal of Medicine did not choose to make these apparent conflicts of interest public.

Without the knowledge of these financial relationships, one might suppose Ms Wilensky's opinions are only based on her disinterested expertise as a well-known health care policy scholar. Without knowledge of these financial relationships, one might think that a secretive, opaque process skewing physicians' payments toward procedures is not an important problem for our health care system.

We have come to a critical time in the history of attempts to reform the US health care system. Whether reform occurs, and whether it does any good will depend on the quality of the debate that precedes it. Such a debate should be robust, but those involved ought to make clear where their biases and interests may lie.

Unfortunately, it may be that some of the most prominent voices in the debate are those of people with strong personal financial interests in having health care reform go in certain directions, not others. Furthermore, people with particular interests may not want certain issues to be even brought up. If these interests are not revealed, the debate becomes deceptive.

In a previous post, I said "I fear that much of the debate up to now has been deceptive, and will not lead to good outcomes." Since the current post is also about a prominent health care expert published in a leading international forum whose arguments seem to obfuscate a major cause of our health system dysfunction, possibly due to conflicts of interest which were not disclosed, my fear has become stronger.




References

1. Wilensky GR. Reforming Medicare's physician payment system. New Engl J Med 2009; 360: 653-655. Link
here.

2.Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link here.

3. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link here.