A man on disability since surgeons may have operated on him with instruments coated in hydraulic fluid will be able to sue Duke University Medical System after a judge ruled that the $14,000 price tag to bring the grievance before a panel of private arbitrators is too costly. The ruling could be repeated in other courtrooms around the state, and it echoes a decision by the North Carolina Supreme Court earlier this year that found mandatory arbitration agreements can make it too pricey for consumers to pursue their disputes. The ruling could also help create a more favorable legal climate for an untold number of the 3,648 patients who may have been operated on in late 2004 with contaminated instruments at two Duke hospitals.
Despite the mass exodus of doctors from the New Orleans area after Hurricane Katrina, a journal is reporting that doctors have returned to the city at a rate that has pushed their per-capita number above the national average. The American Journal of the Medical Sciences says the number of doctors in Orleans, St. Bernard, Plaquemines, and Jefferson parishes has grown at from 239 doctors per 100,000 people in 2005 to 256 doctors per 10,000 in 2007. The national average is 237 doctors per 100,000, and the trend in New Orleans is one of many signs indicating the city's healthcare system is recovering, medical professionals say.
The Department of Health and Environmental Control has decided to allow another vote on an amendment to the South Carolina health plan that will make it easier for Lexington Medical Center to gain state approval to build a heart center. Lexington Medical asked the DHEC to make changes in the state's health insurance plan that would lower the minimum number of heart surgeries a heart center must perform to remain open and maintain quality. Currently, only Providence Hospital and Palmetto Health are certified to perform open-heart surgeries in the region. State officials have blocked efforts to establish a heart unit in Lexington, saying the region does not need a third open-heart surgery program. But Lexington Medical has remained persistent in making its case.
Des Moines, IA-based Broadlawns Medical Center has announced it is cutting back on free prescription drugs for its patients. The medical center recently sent a letter to patients saying they would all have to start paying $4 per prescription, beginning in September. But uninsured patients whose income is below the federal poverty level will continue to receive free medication, and no eligible patient will be charged more than $20 per month, said hospital officials. Hospital leaders said Broadlawns was one of only two public hospitals in the country that still gave free medications to patients, but the hospital can no longer afford to do so.
After a year of delays, Women & Children's Hospital of Buffalo is taking the next step for an ambulatory services center. Plans call for a five-story, 190,000-square-foot outpatient diagnostic and treatment center. In addition to doctors' offices, the center will bring together about a dozen outpatient clinics currently located throughout the hospital, and there will be eight outpatient operating rooms.
Especially for celebrated plaintiff's attorney Richard "Dickie" Scruggs. You hospital CFOs remember him, don't you?
He came after you aggressively just four short years ago for your charity care policies, your chargemaster prices, and your own aggressive collection practices. He suggested you didn't deserve your multiple tax exemptions because you didn't offer enough charity care—by a long shot—in return for not having to pay taxes. He filed lawsuits against many of you that, while they ultimately went nowhere, were quite scary back in the fall of 2004, when I last spoke with him for a cover story in HealthLeaders magazine entitled "Do Nonprofit Hospitals Deserve Their Tax-Exempt Status?"
Many lawsuits were filed against nonprofit hospitals across the country. If you had a discrepancy between your hospital's chargemaster and what you charged insurance companies—as almost every hospital did at the time—you were a fat, juicy lawsuit target. He even convinced one major hospital in his own backyard, North Mississippi Medical Center, to settle his lawsuit in return for multiple changes in its charity care practices. Things were looking up for Scruggs. After all, fresh on the heels of his tobacco litigation success, he and his firm were on a hot streak.
Now he's in jail. In a Kentucky federal prison, to be exact. Serving a five-year sentence. Disgraced and disbarred.
That's right, Scruggs and his son both received jail sentences early this summer for attempting to bribe a Mississippi judge in return for turning over Hurricane Katrina settlement money that was held up in court. Instead, the judge turned FBI informant and got the goods on the Scruggses. The elder Scruggs will serve five years. His son will serve a little more than one.
I'll forgive you if you want to take a few seconds to snicker up your sleeve.
Many hospital leaders saw Scruggs' actions as simply the latest money grab for a smooth-talking Mississippi attorney who got filthy rich off of tobacco litigation in the 1990s and became something of a minor celebrity as a character played by actor Colm Feore in the 1999 film "The Insider," which also starred Al Pacino and Russell Crowe.
The truth is somewhat more complicated, but it's hard to argue that greed didn't have a lot to do with Scruggs' actions toward hospitals when the man who owns his own Gulfstream jet tried to buy a judge over an insurance settlement.
Bill Cox, then president and CEO of the Sacramento-based Alliance for Catholic Healthcare, saw former Sen. Trent Lott's brother-in-law as an opportunist who was simply seeking another easy class action target-a "vulnerability they could exploit." Seems more true than it ever did.
Scruggs apparently quickly lost interest in the hospital lawsuits after a few legal setbacks, and, more importantly, after Hurricane Katrina hit New Orleans and the Mississippi Gulf Coast. Without a doubt, given what's happened in the intervening years, he saw the deep pockets of insurance companies just itching to be picked.
Now his alma mater, the University of Mississippi, is frantically scrubbing off the Scruggs name from a building or two, as two large universities in Alabama recently did with buildings named after Richard Scrushy of HealthSouth infamy. As a graduate of bitter rival Mississippi State University, I can't help but snicker a little bit myself. But strange as it sounds, I also feel some sympathy for the guy, although it's hard to feel sympathy for someone who will go back to his multimillionaire lifestyle once his debt to society is paid.
As in many cases where the mighty have fallen, the bad guys don't wear all black hats and the good guys don't wear all white. After all, some hospitals were abusing their nonprofit status, and some probably continue to do so. And money is a powerful motivator. Without people like Scruggs, many hospitals might still be suing poor people based on inflated list charges. The regulations that are coming down from Congress and the IRS in the form of charity care regulations and tax filing requirements have added some bureaucracy to the tax exemption game, but they've added a bit of much-needed transparency, too. It'll be harder to get away with violating the spirit of tax exemptions simply because unlike four years ago, some regulations are nearly complete that will force hospitals to justify their benefit to the community they serve.
In fact, hospital leaders can take a big lesson from the fall of Richard Scruggs.
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