Catholic Healthcare West will pay the federal government $275,000 to resolve allegations that the three-state, San Francisco-based health system created unnecessary and discriminatory hurdles against work-authorized, legal immigrant job seekers, the Department of Justice said this week.
CHW required non-US citizen and naturalized US citizen new employees to present more work authorization documents than required by federal law, but permitted native born US citizens to provide documents of their own choosing, DOJ said. The Immigration and Nationality Act prohibits employers from imposing different or greater employment-eligibility verification (I-9) standards on the basis of a worker’s citizenship status.
In addition to the $275,000 payment –the largest civil penalties ever paid to resolve such allegations---CHW will pay $1,000 in back salary to the employee who brought the complaint.
CHW, the eighth-largest health system in the nation, has agreed to review its past I-9 practices at all of its 41 facilities in California, Arizona, and Nevada, to identify and compensate other victims of over-documentation. The health system must also devise policies for ensuring best practices in hiring and employment eligibility verification, train its human resources staff about anti-discrimination laws, and provide periodic status reports to DOJ for three years.
The health system issued a statement Tuesday saying," CHW has cooperated fully in the development of this settlement agreement with the Department of Justice. CHW has implemented system wide training to address the concerns raised by the DOJ. We are in the process of reviewing and updating our hiring policies and procedures to ensure that such concerns do not arise in the future."
"All workers who are authorized to work in the United States have the right to look for a job without encountering discrimination because of their immigration status or national origin," said Thomas E. Perez, assistant attorney general for DOJ’s Civil Rights Division. "We are pleased to have reached a settlement with CHW and look forward to continuing to work with public and private employers to educate them about anti-discrimination protections and employer obligations under the law."
In an effort to adapt to changes and financial challenges created by healthcare reform, Scripps Health has implemented a horizontal management restructuring model that it says will cut costs, improve care, and preserve jobs.
The San Diego, CA-based, nonprofit health system is reorganizing every department within this horizontal co-management structure to standardize clinical and operational functions across its five hospitals and 20 outpatient centers.
"Very few health systems have a complete system-wide horizontal leadership structure to go along with the traditional vertical management structure," says Chris Van Gorder, Scripps Health president/CEO. "We believe we are one of the first to move in this direction."
Van Gorder says the management scheme will cut costs by eliminating unnecessary variations in how the facilities operate and deliver care. The changes began Oct. 1, in line with reductions in reimbursements from Medicare and commercial health insurers.
Some parts of healthcare reform are being felt now—years before they were expected, Van Gorder says. Government payers are cutting reimbursements, and private payers are following suit, prompting health systems to either adapt or face losing millions of dollars in operational income.
"As reimbursements fall, we must reduce our costs and improve the already high quality care we provide without resorting to across-the-board cuts and layoffs," Van Gorder says. "I want to make sure that we take care of our people, just as they take care of our patients. As part of this process, we are committed to preserving jobs for those who are displaced by this restructuring."
Scripps is identifying unnecessary and costly variations in practice, staffing, use of supplies and services, patient quality and satisfaction, physician satisfaction and others areas, and wants to replace the variations with best practices from within Scripps or other health systems.
A preliminary audit conducted by Scripps' project management office identified approximately $150 million in variations and potential annual cost reductions across the health system.
Potential long-term cost savings could come from areas as diverse as:
Coffee vendors ($200,000);
Clinical laboratory functions ($6 million to $12 million);
Cardiac surgery programs (approximately $4.3 million).
In the past 20 months, Scripps has saved about $8 million by in-sourcing and standardizing pharmacy management functions.
Scripps has divided the horizontal co-management into four operational divisions:
Corporate Medical Division, led by CMO Brent Eastman, MD, includes nursing; quality; research and medical management and physician co-management.
Clinical Operations Division, led by Senior Vice President Barbara Price, includes clinical support; clinical ancillaries; and clinical service lines.
Support Services Division, led by Senior Vice President John Armstrong, includes surgery, pharmacy and supply chain management; facilities design and construction; and support services.
Administrative Services Division has already been operating horizontally, and includes finance; human resources; legal; audit and compliance; information services; physician services; community benefit; project management; government affairs; marketing communications; and philanthropy.
Scripps is working with its physician leaders to extend the co-management structure to its 2,500 affiliated physicians, with the aim of laying groundwork for the co-management models called for in healthcare reform. That includes creating clinical workflows designed around best practices.
To avoid layoffs, Scripps has a Career Resource Center to transition employees into new jobs in the health system. Job openings throughout Scripps are being held to create opportunities for staff in the CRC.
A North Carolina family doctor has been sentenced to three years in prison and ordered to pay more than $600,000 in restitution to the Internal Revenue Service for obstructing tax laws and failing to pay income taxes for at least four years, the Justice Department and IRS say.
A federal jury in 2009 convicted Rodney K. Justin, MD, from Woodleaf, NC, of four felony counts of obstructing internal revenue laws by sending bogus "Bills of Exchange" to the Treasury Department in purported payment of more than $350,000 in taxes. The jury also convicted Justin of willful failure to file tax returns for the tax years 2001 through 2004.
Federal prosecutors showed at trial that Justin had not filed a tax return since 1997, even though he had earned more than $200,000 each year from 2001 through 2004. Justin sent letters and bogus returns to the IRS advancing false and frivolous "tax defier" claims purporting to explain why he didn’t have to pay taxes. The IRS repeatedly warned Justin that his claims were frivolous and told him of his legal duty to file returns and pay taxes.
From 1998 through early 2004, Justin was a client at Guiding Light of God Ministries, also known as American Rights Litigators, formerly of Mount Dora, FL. The evidence showed that Justin purchased the four fictitious "Bills of Exchange" he submitted in purported payment of income taxes from ARL.
In August 2004, a federal district judge permanently banned ARL and two of its promoters from the sale of a nationwide tax scam. In April 2008, a federal court in Florida sentenced two promoters of ARL and a client—actor Wesley Snipes—to prison for tax offenses. In August, three ARL promoters were sentenced to 10 years in prison, and ARL founder Eddie Ray Kahn, got a 20-year sentence.
The North Carolina Medical Board in September suspended Justin for 12 months, but stayed the suspension, and noted that the criminal prosecution "relates solely to Dr. Justin's income tax matters and does not related to any medical care that Dr. Justin has rendered."
Justin's sentence was imposed by US District Chief Judge James A. Beaty Jr. in Winston-Salem, NC.
Twenty-four states gambled—and came up short—on receiving additional federal funds to relieve state Medicaid budgets stressed by the recession. The Federal Medicaid Assistance percentages fell $1.74 billion short of what those 24 states had planned, leaving huge holes in their budgets, according to research by The Council of State Governments.
Those 24 states assumed the federal government would extend the 2009 Recovery Act's increased Medicaid dollars to their 2011 fiscal year budgets. Although Congress voted to provide $14.15 billion in Medicaid funds to the states, it wasn't enough for some state budgets.
"Medicaid can be the bane of state budgets," says Debra Miller, director of health policy at CSG. "The policy wonks say Medicaid is a counter-cyclical program. But that knowledge is small comfort to those in charge of balancing budgets, who watch Medicaid rolls expand as people lose jobs at the same time state revenues shrink as tax receipts decline."
The states that did not budget the additional funds—which includes California with its budget in limbo—now have an additional estimated $7.3 billion in federal funds. They can move state general fund revenue they had earmarked for Medicaid for other spending, or use these state funds to pull down even more Medicaid money, Miller said.
The additional federal funding will help cash-strapped states in the short term, but enrollment trends and rising healthcare costs mean that Medicaid spending will continue to strain state budgets. Most states say enrollment is growing faster than expected because of the slow economy. Many states will likely face Medicaid budget deficits by the end of fiscal 2011.
"The federal match for Medicaid may be a good deal for states—but states still have to come up with their share," Miller said. "In today's lean times, that is difficult and the states that counted on a larger match are digging into other state programs, including K-12 and higher education."
The additional funding ranges from $22 million in North Dakota, and $23 million in Wyoming and South Dakota, to $851 million in Texas, $1.41 billion in New York and $1.88 billion in California.
The Department of Justice filed a civil antitrust lawsuit Monday against Blue Cross Blue Shield of Michigan, alleging that the insurer's most favored nation pacts with hospitals across the state raise prices, stifle competition from other insurers, and discourage discounts.
As a result of these MFN pacts, Michigan consumers pay higher prices for healthcare services and health insurance, said Christine Varney, assistant attorney general in charge of DOJ's Antitrust Division.
"Any time a dominant provider uses anticompetitive agreements, the market suffers. This cannot be allowed in Michigan. And, let me be clear, we will challenge similar anticompetitive behavior anywhere else in the United States," Varney said.
Andrew Hetzel, BCBSM vice president for corporate communications, said the suit is "without merit" and that the insurer would "vigorously defend our ability to negotiate the deepest possible discounts for our members and customers with Michigan hospitals."
"Negotiated hospital discounts are a tool that Blue Cross uses to protect the affordability of health insurance for millions of Michiganders. Through this lawsuit, the federal government seeks to deny millions of Michigan residents the lowest cost possible when they visit the hospital," Hetzel said.
DOJ's complaint focuses on the MFN clauses that guarantee that other health plans cannot get a better rate. DOJ alleges that BCBSM's MFN clauses with hospitals have caused hospitals to increase their prices to BCBSM's competitors and insulated BCBSM from competition. BCBSM has used MFNs or similar clauses in its contracts with at least 70 of Michigan's 131 general acute care hospitals, including major hospitals, the DOJ complaint alleges.
DOJ said the MFNs require a hospital either to charge BCBSM no more than it charges the insurer's competitors, or to charge the competitors a specified percentage more than it charges BCBSM, in some cases between 30% and 40%. The complaint further alleges that BCBSM's use of MFN has reduced competition in the sale of health insurance in Michigan by raising hospital costs to BCBSM's competitors, which discourages other insurers from entering or expanding in Michigan.
BCBSM agreed to raise the prices it pays some hospitals to get the MFNs, thus buying protection from competitors by increasing its own costs, the complaint alleges.
"When a large healthcare plan with a substantial market share, like Blue Cross, imposes an anticompetitive MFN in the marketplace, it harms competition and consumers. It prevents others from entering the marketplace and discourages discounting. The end result: fewer options and higher prices," Varney said.
Nonprofit BCBSM is the largest commercial health insurer in Michigan, with revenues exceeding $10 billion in 2009. BCBSM insures more than nine times as many Michigan residents as its next largest commercial health insurance competitor, covering more than 60% of Michigan's 3 million commercially insured residents.
Hetzel said the hospital discounts BCBSM negotiates "are a vital part of our statutory mission to provide Michigan residents with statewide access to healthcare at a reasonable cost."
"It does not make good business sense for Blue Cross Blue Shield of Michigan to reimburse a provider at a higher rate than we can otherwise negotiate," Hetzel said. "These kinds of low cost guarantees are widely used in a variety of contracts in a number of industries. In fact, the federal government routinely requires its own vendors to abide by these same low cost requirements."
The state of Michigan joined DOJ in its lawsuit, which was filed in U.S. District Court in Detroit.
A study, Contributing to a Healthier Economy in Northeast Ohio: The Impact of Summa Health System, shows that Summa's $2.86 billion in total economic impact to Ohio consisted of $1.2 billion in direct business, which includes institutional spending, employee spending, and spending by visitors to Summa facilities. It also included $1.6 billion in indirect impact—a multiplier effect caused by the re-spending of dollars in the local economy as a result of Summa's presence.
The largest economic impact occurred in Summit County, where the health system accounted for $1.6 billion in business activity and provided wage and salaried employment for nearly 7,000 direct and indirect full time employees in 2009, the report showed.
Summa, which includes six affiliated hospitals, health centers, a health plan, a physician-hospital association, a research group and multiple foundations, also provided significant economic impact across the neighboring counties of Portage ($228 million), Stark ($342 million), Medina ($119 million) and Wayne ($42 million), the report said.
The report, conducted by Tripp Umbach, projected that Summa's total annual business volume impact on Ohio will increase by approximately $2.6 billion by the year 2014, which was attributed to growth in capital expenditures, operating expenses and employment to support the health system's expansion.
Summa also issued its annual Community Benefit report. As the region's largest safety-net provider, Summa delivered $110.8 million in community benefit—including $31 million in the net cost of charity care, and $16.6 million in unpaid costs for Medicaid patients. Summa reported $21.6 million in bad debt, and $12.8 million in subsidized health services, such as senior health, HIV/AIDS care, and dental heath.
The first six months of 2010 were very productive for the nation's healthcare unions, and there is little to indicate that the tide is turning in management's favor, at least for the next year or so.
The 35th Semi Annual Labor Activity in Healthcare Report—conducted by IRI Consultants for the American Society for Healthcare Human Resources Administration—found union win rates in healthcare representation elections have held above 70% for five straight years.
Even more impressive, in the first six months of 2010 the Service Employees International Union won 91% of its representation elections, and the newly formed National Nurses United won 100% of its elections.
Clearly, when a healthcare union targets a hospital for an organizing campaign, it's highly likely that the union will succeed.
The report's findings indicate more aggressive attitudes by healthcare unions that show no sign of abating into 2011.
For example:
In 2009, there were a total of 220 organizing elections in the healthcare sector, and unions won 153 (70%) of them. In the first six months of 2010 there were 143 elections in the healthcare sector and unions won 105 (73%).
SEIU accounted for 39% of all organizing petitions filed in the first six months of 2010, up from 27% in 2009. AFSCME and UFCW, both with 11%, followed by IBT, with 8%, and NNU, with 5%.
27% of organizing petitions filed in healthcare organizations in the first half of 2010 were withdrawn, dismissed, transferred or nullified—down from 48% in 2009.
Unions won a staggering 89% of decertification elections in the first six months of 2010 versus 58% in 2009.
In 2009, there were 11 strikes that idled 2,614 workers, averaging 238 workers per strike. In the first half of 2010, there were seven strikes involving 13,898 workers, averaging 1,985 workers per strike.
IRI President Jim Trivisonno says unions are at a distinct advantage for a number of reasons, including pro-labor sentiment on the National Labor Relations Board, the White House, and (at least for the next month or so) in Congress, and workers' anxiety over the economy.
In addition to expanding their rank and file, Trivisonno says healthcare unions will tap their connections in the federal and state government to push for hot-button mandates like staffing ratios.
"You will begin to see decisions coming out, we are already seeing some, that are going to further provide unions with additional protections and rights, not just to organize, but with employee discharges, the ability to strike, permanent replacements, a host of things," he says.
Trivisonno says that—if Republicans take the House next month—NRLB will be pressed "to jam as many decisions in as they can, this very liberal NLRB, between now and August," when the term of President Obama's controversial recess appointment of labor lawyer Craig Becker expires.
"It will be a much less liberal board after August of next year. I would look for that. They will overturn cases that currently exist. Clearly they will be favorable to labor unions," Trivisonno says.
Organized labor often taps into the anxiety of workers during a recession, which Trivisonno says was shown in the spike in union victories in decertification elections. "Unions won nearly 90% of the de-cert elections in the first six months of last year. That number is off the charts," he says. "It's the economy again. Employees have concerns about downsizing and benefits. They are seeing these things happening, and the union says if you have a union contract this couldn't happen. Without a union contract, the employer is free to make changes."
Trivisonno believes that nurses unions' influence might increase as the economy recovers and the nursing shortage returns as an issue.
"You will see some additional union organizing and pushes for state and federal legislation around staffing ratios," he says. "In nursing, as staffing becomes a bigger issue, nurses will seek out unions in an attempt to fix that problem for them and potentially get staffing ratios in a collective bargaining agreement."
Trivisonno says NNU has accomplished a lot since its formation last year, and he credits the effective leadership and cooperation between NNU and SEIU for much of the success.
"The arrangement is the NNU gets the nurses, the SEIU gets everyone else," he says.
Newly elected SEIU President Mary Kay Henry doesn't have jagged relations that former SEIU President Andy Stern had with rival unions, and that allows her to work with them to patch up differences.
"Her approach is going to be to increase organizing and one of the best ways to do that is to align with other unions rather than competing," Trivisonno says.
There is still some distrust and friction between NNU and some state nurses associations, but Trivisonno says that that is lessening. NNU won a lot of admirers in labor with its aggressive tactics in several nurses' strikes this year, most notably stoppages in Minnesota and Philadelphia. NNU Executive Director Rose Ann DeMoro has made it clear that the union is not afraid to strike.
While labor finds itself very much in the driver's seat, Trivisonno says hospitals aren't entirely powerless. He says the best antiunion measures require proactive communication with staff.
"You have to get ahead of it. Education is key from the board level to employees," he says. "The most important things are employee engagement. Unions don't like shared governance and (nursing) magnet status, and those are heavy engagement components. Communicate openly and honestly."
Lastly, he suggests, hospital leaders should have tools in place that can assess employees' attitudes in real time as critical issues are occurring. "A lot of people do opinion surveys once a year or ever other year. But there are periods in between those assessments where you have to constantly keep in touch with how employees are feeling," Trivisonno says. "There is always a triggering incident. Something happens that causes employees to consider having a labor union. Recognizing what that is and dealing with it quickly becomes a key piece of being prepared."
Most doctors don't follow practice guidelines for recommending colorectal cancer screenings, a study shows.
The survey of nearly 1,300 primary care physicians in the United States found that only about 20% of them recommend colorectal cancer screenings tests to their patients in accordance with current practice guidelines. About 40% of the doctors followed some of the practice guidelines, while the remaining 40% ignore practice guidelines.
NCI investigator Robin Yabroff said the survey suggests that by not using practice guidelines, many physicians either overuse or underuse screening tests. The underuse of CRC screenings may result in fewer earlier stage or pre-invasive cancers being detected, while overuse of screening results in expensive, unnecessary screenings and puts patients at risk for certain types of screening-related complications. The study results appeared Oct.14, in the Journal of General Internal Medicine.
CRC screening guidelines have been developed by the several groups, including the U.S. Preventive Services Task Force. The guidelines recommend screening for CRC using high-sensitivity fecal occult blood testing, flexible sigmoidoscopy, double-contrast barium enema, or colonoscopy. Initiating screening at age 50 is recommended, although the time between screenings varies.
Having multiple modalities available for screening allows physicians and patients to consider the risks, benefits and other attributes of CRC screening tests and to ultimately identify the option best suited to the patient. However, multiple screening modalities may also contribute to confusion about their appropriate use by physicians and patients.
IPC The Hospitalist Company, Inc., has acquired Post-Acute Medical Associates, PC, in Morristown, NJ; and Muhammad Syed, MD, PC, in Las Vegas, NV.
Combined, the two groups see about 20,000 patients annually. IPC already has hospitalist practices in both markets, thus the two newly acquired physicians' groups will join existing IPC practices.
"Like the dozens of local independent practices that have chosen to partner with us, PAMA and Syed will greatly benefit from the administrative, financial, and technology support IPC provides to our practices," says R. Jeffrey Taylor, president/COO of IPC The Hospitalist Company. "Partnering is an increasingly attractive option for the local independent practice to deliver the improved care and coordination that hospitals, skilled nursing facilities, payers, and the entire medical community demand from inpatient care today."
North Hollywood, CA-based IPC provides management services to hospitalist practices in more than 500 facilities, and employs more than 1000 affiliated healthcare providers.
CVS Pharmacy, Inc. will pay a record $75 million in civil penalties after admitting that it sold pseudoephedrine, a key ingredient in the production of methamphetamine, to criminals in 25 states.
As part of the agreement with federal prosecutors, the nation's largest retail pharmacy chain has also agreed to forfeit $2.6 million in profits the company earned from the illegal sales.
The $75 million portion of the settlement represents the largest civil penalty ever paid under the Controlled Substances Act.
"This historic settlement underscores Drug Enforcement Administration's commitment to protect the public's health and safety against the scourge of methamphetamine," said Michele M. Leonhart, DEA acting administrator. "CVS's flagrant violation of the law resulted in the company becoming a direct link in the methamphetamine supply chain.
DEA will continue to work with its state and local counterparts to disrupt the supply of methamphetamine, including inhibiting access to chemicals, such as pseudoephedrine, used to produce methamphetamine."
The U.S. Attorneys Office in Los Angeles, CA, which led the investigation, said the sales occurred in CVS stores located primarily in Los Angeles County; Orange County, CA; and Clark County, NV.
Between September 2007 and November 2008, prosecutors said, CVS supplied large amounts of pseudoephedrine to methamphetamine traffickers in Southern California, and the company's illegal sales led directly to an increase in methamphetamine production in California.
CVS, a subsidiary of Woonsocket, RI-based CVS Caremark Corp., eventually changed its sales practices, but only after it became aware of the government's investigation.
"This case shows what happens when companies fail to follow their ethical and legal responsibilities," said U.S. Attorney André Birotte Jr.
"CVS knew it had a duty to prevent methamphetamine trafficking, but it failed to take steps to control the sale of a regulated drug used by methamphetamine cooks as an essential ingredient for their poisonous stew," Birotte said.
The investigation uncovered thousands of violations of the Combat Methamphetamine Epidemic Act of 2005, which limits the amount of pseudoephedrine that a customer can purchase in one day.
CVS blamed the multistate illegal sales on "an electronic monitoring system flaw that has been corrected," and said the previously disclosed settlement would have no further impact on its finances.
In 2007, CVS implemented an automated electronic logbook system to record pseudoephedrine sales, but the system did not prevent multiple purchases by an individual customer on the same day. The government learned that violations occurred in California and Nevada, and in 23 other states where CVS failed to implement appropriate safeguards. The settlement addresses CVS's liability in 25 states.
"We are announcing today that we have resolved this issue, which unfortunately resulted from a breakdown in CVS/pharmacy's normally high management and oversight standards," said Thomas M. Ryan, chairman/CEO of CVS Caremark. "While this lapse occurred in 2007 and 2008 and has been addressed, it was an unacceptable breach of the company's policies and was totally inconsistent with our values. CVS/pharmacy is unwavering in its support of the measures taken by the federal government and the states to prevent drug abuse."
Ryan said CVS has strengthened internal controls to prevent future lapses, and has made "substantial investments to improve our handling and monitoring of (pseudoephedrine) by implementing enhanced technology and making other improvements in our stores and distribution centers."
In mid-2007, after Mexico banned the sale of pseudoephedrine, federal officials said Los Angeles County experienced an epidemic in a practice known as "smurfing," where individuals buy small amounts of pseudoephedrine in separate purchase to make methamphetamine. Smurfers discovered that CVS, unlike other large chain retail pharmacies, allowed customers to make repeated purchases of pseudoephedrine which exceeded federal daily and monthly sales limits.
Smurfers inundated CVS stores in Los Angeles and Orange Counties, and Las Vegas to purchase cough and cold remedies, sometimes cleaning out store shelves. For more than a year, CVS failed to change its sales practices to stop the illicit trade.
The government has agreed not to pursue criminal charges against CVS, which has accepted responsibility for the illegal conduct and has agreed to implement a compliance and ethics program over the next three years.
CVS has entered into a separate five-year compliance agreement with the DEA.
