The insurance industry gives lucrative commissions and bonuses to independent brokers who advise employers. Critics call the payments a "classic conflict of interest" that drive up costs.
This article was co-published February 20, 2019, by ProPublica and NPR'sShots blog.
The pitches to the health insurance brokers are tantalizing.
"Set sail for Bermuda," says insurance giant Cigna, offering top-selling brokers five days at one of the island's luxury resorts.
Health Net of California's pitch is not subtle: A smiling woman in a business suit rides a giant $100 bill like it's a surfboard. "Sell more, enroll more, get paid more!" In some cases, its ad says, a broker can "power up" the bonus to $150,000 per employer group.
Not to be outdone, New York's EmblemHealth promises top-selling brokers "the chance of a lifetime": going to bat against the retired legendary New York Yankees pitcher Mariano Rivera. In another offer, the company, which bills itself as the state's largest nonprofit plan, focuses on cash: "The more subscribers you enroll … the bigger the payout." Bonuses, it says, top out at $100,000 per group, and "there's no limit to the number of bonuses you can earn."
Such incentives sound like typical business tactics, until you understand who ends up paying for them: the employers who sign up with the insurers — and, of course, their employees.
Human resource directors often rely on independent health insurance brokers to guide them through the thicket of costly and confusing benefit options offered by insurance companies. But what many don't fully realize is how the health insurance industry steers the process through lucrative financial incentives and commissions. Those enticements, critics say, don't reward brokers for finding their clients the most cost-effective options.
Here's how it typically works: Insurers pay brokers a commission for the employers they sign up. That fee is usually a healthy 3% to 6% of the total premium. That could be about $50,000 a year on the premiums of a company with 100 people, payable for as long as the plan is in place. That’s $50,000 a year for a single client. And as the client pays more in premiums, the broker's commission increases.
Commissions can be even higher, up to 40% or 50% of the premium, on supplemental plans that employers can buy to cover employees' dental costs, cancer care or long-term hospitalization.
Those commissions come from the insurers. But the cost is built into the premiums the employer and employees pay for the benefit plan.
Now, layer on top of that the additional bonuses that brokers can earn from some insurers. The offers, some marked "confidential," are easy to find on the websites of insurance companies and broker agencies. But many brokers say the bonuses are not disclosed to employers unless they ask. These bonuses, too, are indirectly included in the overall cost of health plans.
These industry payments can't help but influence which plans brokers highlight for employers, said Eric Campbell, director of research at the University of Colorado Center for Bioethics and Humanities.
"It’s a classic conflict of interest," Campbell said.
There’s "a large body of virtually irrefutable evidence," Campbell said, that shows drug company payments to doctors influence the way they prescribe. "Denying this effect is like denying that gravity exists." And there’s no reason, he said, to think brokers are any different.
Critics say the setup is akin to a single real estate agent representing both the buyer and seller in a home sale. A buyer would not expect the seller's agent to negotiate the lowest price or highlight all the clauses and fine print that add unnecessary costs.
"If you want to draw a straight conclusion: It has been in the best interest of a broker, from a financial point of view, to keep that premium moving up," said Jeffrey Hogan, a regional manager in Connecticut for a national insurance brokerage and one of a band of outliers in the industry pushing for changes in the way brokers are paid.
As the average cost of employer-sponsored health insurance premiums has tripled in the past two decades, to almost $20,000 for a family of four, a small, but growing, contingent of brokers are questioning their role in the rise in costs. They've started negotiating flat fees paid directly by the employers. The fee may be a similar amount to the commission they could have earned, but since it doesn't come from the insurer, Hogan said, it "eliminates the conflict of interest" and frees brokers to consider unorthodox plans tailored to individual employers' needs. Any bonuses could also be paid directly by the employer.
Brokers provide a variety of services to employers. They present them with benefits options, enroll them in plans and help them with claims and payment issues. Insurance industry payments to brokers are not illegal and have been accepted as a cost of doing business for generations. When brokers are paid directly by employers, the results can be mutually beneficial.
In 2017, David Contorno, the broker for Palmer Johnson Power Systems, a heavy-equipment distribution company in Madison, Wisconsin, saved the firm so much money while also improving coverage that Palmer Johnson took all 120 employees on an all-expenses paid trip to Vail, Colorado, where they rode four-wheelers and went whitewater rafting. In 2018, the company saved money again and rewarded each employee with a health care "dividend" of about $700.
Contorno is not being altruistic. He earned a flat fee, plus a bonus based on how much the plan saved, with the total equal to roughly what would have made otherwise.
Craig Parsons, who owns Palmer Johnson, said the new payment arrangement puts pressure on the broker to prevent overspending. His previous broker, he said, didn't have any real incentive to help him reduce costs. "We didn't have an advocate," he said. "We didn't have someone truly watching out for our best interests." (The former broker acknowledged there were some issues, but said it had provided a valuable service.)
Working for Employers, Not Insurers
Contorno is part of a group called the Health Rosetta, which certifies brokers who agree to follow certain best practices related to health benefits, including eliminating any hidden agreements that raise the cost of employee benefits. To be certified, brokers (who refer to themselves as "benefits advisers") must disclose all their direct and indirect sources of income — bonuses, commissions, consulting fees, for example — and who pays them to the employers they advise.
Dave Chase, a Washington businessman, created Rosetta in 2016 after working with tech health startups and launching Microsoft's services to the health industry. He said he saw an opportunity to transform the health care industry by changing the way employers buy benefits. He said brokers have the most underestimated role in the healthcare system. "The good ones are worth their weight in gold," Chase said. "But most of the benefit brokers are pitching themselves as buyer's agents, but they are paid like a seller's agent."
There are only 110 Rosetta certified brokers in an industry of more than 100,000, although others who follow a similar philosophy consider themselves part of the movement.
From the employer's point of view, one big advantage of working with brokers like those certified by Rosetta, is transparency. Currently, there's no industry standard for how brokers must disclose their payments from insurance companies, so many employers may have no idea how much brokers are making from their business, said Marcy Buckner, vice president of government affairs for the National Association of Health Underwriters, the trade group for health benefits brokers. And thus, she said, employers have no clear sense of the conflicts of interest that may color their broker's advice to them.
Buckner's group encourages brokers to bill employers for their commissions directly to eliminate any conflict of interest, but, she said, it's challenging to shift the culture. Nevertheless, Buckner said she doesn’t think payments from insurers undermine the work done by brokers, who must act in their clients' best interests or risk losing them. "They want to have these clients for a really long term," Buckner said.
Industrywide, transparency is not the standard. ProPublica sent alist of questions to 10 of the largest broker agencies, some worth $1 billion or more, including Marsh & McLennan, Aon and Willis Towers Watson, asking if they took bonuses and commissions from insurance companies, and whether they disclosed them to their clients. Four firms declined to answer; the others never responded despite repeated requests.
Patients may think their insurers are fighting on their behalf for the best prices. But saving patients money is often not their top priority. Just ask Michael Frank.
Insurers also don't seem to have a problem with the payments. In 2017, Health Care Service Corporation, which oversees Blue Cross Blue Shield plans serving 15 million members in five states, disclosed in its corporate filings that it spent $816 million on broker bonuses and commissions, about 3% of its revenue that year. A company spokeswoman acknowledged in an email that employers are actually the ones who pay those fees; the money is just passed through the insurer. "We do not believe there is a conflict of interest," she said.
In one email to a broker reviewed by ProPublica, Blue Cross Blue Shield of North Carolina called the bonuses it offered — up to $110,000 for bringing in a group of more than 1,000 — the "cherry on top." The company told ProPublica that such bonuses are standard and that it always encourages brokers to "match their clients with the best product for them."
Cathryn Donaldson, spokeswoman for the trade group America's Health Insurance Plans, said in an email that brokers are incentivized "above all else" to serve their clients. "Guiding employees to a plan that offers quality, affordable care will help establish their business and reputation in the industry," she said.
Some insurer's pitches, however, clearly reward brokers' devotion to them, not necessarily their clients. "To thank you for your loyalty to Humana, we want to extend our thanks with a bonus," says one brochure pitched to brokers online. Horizon Blue Cross Blue Shield of New Jersey offered brokers a bonus as "a way to express our appreciation for your support." Empire Blue Cross told brokers it would deliver new bonuses "for bringing in large group business ... and for keeping it with us."
Delta Dental of California's pitches appears to go one step further, rewarding brokers as "key members of our Small Business Program team."
ProPublica reached out to all the insurers named in this story, and many didn't respond. Cigna said in a statement that it offers affordable, high-quality benefit plans and doesn't see a problem with providing incentives to brokers. Delta Dental emphasized in an email it follows applicable laws and regulations. And Horizon Blue Cross said its gives employers the option of how to pay brokers and discloses all compensation.
The effect of such financial incentives is troubling, said Michael Thompson, president of the National Alliance of Healthcare Purchaser Coalitions, which represents groups of employers who provide benefits. He said brokers don’t typically undermine their clients in a blatant way, but their own financial interests can create a "cozy relationship" that may make them wary of "stirring the pot."
Employers should know how their brokers are paid, but healthcare is complex, so they are often not even aware of what they should ask, Thompson said. Employers rely on brokers to be a "trusted adviser," he added. "Sometimes that trust is warranted and sometimes it's not."
Bad Faith Tactics
When officials in Morris County, New Jersey, sought a new broker to manage the county's benefits, they specified that applicants could not take insurance company payouts related to their business. Instead, the county would pay the broker directly to ensure an unbiased search for the best benefits. The county hired Frenkel Benefits, a New York City broker, in February 2015.
Now, the county is suing the firm in Superior Court of New Jersey, accusing it of double-dipping. In addition to the fees from the county, the broker is accused of collecting a $235,000 commission in 2016 from the insurance giant Cigna. The broker got an additional $19,206 the next year, the lawsuit claims. To get the commission, one of the agency's brokers allegedly certified, falsely, that the county would be told about the payment, the suit said. The county claims it was never notified and never approved the commission.
The suit also alleges the broker "purposefully concealed" the costs of switching the county's health coverage to Cigna, which included administrative fees of $800,000.
In an interview, John Bowens, the county"s attorney, said the county had tried to guard against the broker being swayed by a large commission from an insurer. The brokers at Frenkel did not respond to requests for comment. The firm has not filed a response to the claims in the lawsuit. Steven Weisman, one of attorneys representing Frenkel, declined to comment.
Sometimes employers don't find out their broker didn't get them the best deal until they switch to another broker.
Josh Butler, a broker in Amarillo, Texas, who is also certified by Rosetta, recently took on a company of about 200 employees that had been signed up for a plan that had high out-of-pocket costs. The previous broker had enrolled the company in a supplemental plan that paid workers $1,000 if they were admitted to the hospital to help pay for uncovered costs. But Butler said the premiums for this coverage cost about $100,000 a year, and only nine employees had used it. That would make it much cheaper to pay for the benefit without insurance.
Butler suspects the previous broker encouraged the hospital benefits because they came with a sizable commission. He sells the same type of policies for the same insurer, so he knows the plan came with a 40 percent commission in the first year. That means about $40,000 of the employer's premium went into the broker's pocket.
Butler and other brokers said the insurance companies offer huge commissions to promote lucrative supplemental plans like dental, vision and disability. The total commissions on a supplemental cancer plan one insurer offered come to 57%, Butler said.
These massive year-one commissions lead some unscrupulous brokers to "churn" their supplemental benefits, Butler said, convincing employers to jump between insurers every year for the same type of benefits. The insurers don't mind, Butler said, because the employers end up paying the tab. Brokers may also "product dump," Butler said, which means pushing employers to sign employees up for multiple types of voluntary supplemental coverage, which brings them a hefty commission on each product.
Carl Schuessler, a broker in Atlanta who is certified by the Rosetta group, said he likes to help employers find out how much profit insurers are making on their premiums. Some states require insurers to provide the information, so when he took over the account for The Gasparilla Inn, an island resort on the Gulf Coast of Florida, he obtained the report for the company’s recent three years of coverage with UnitedHealthcare. He learned that the insurer had only paid out in claims about 65% of what the Inn had paid in premiums.
But in those same years the insurer had increased the Inn's premiums, said Glenn Price, its chief financial officer. "It's tough to swallow" increases to our premium when the insurer is making healthy profits, Price said. UnitedHealthcare declined to comment.
Schuessler, who is paid by the Inn, helped it transition to a self-funded plan, meaning the company bears the cost of the healthcare bills. Price said the Inn went from spending about $1 million a year to about $700,000, with lower costs and better benefits for employees, and no increases in three years.
A Need for Regulation
Despite the important function of brokers as middlemen, there's been scant examination of their role in the marketplace.
Don Reiman, head of a Boise, Idaho, broker agency and a financial planner, said the federal government should require health benefit brokers to adhere to the same regulation he sees in the finance arena. The Employee Retirement Income Security Act, better known as ERISA, requires retirement plan advisers to disclose to employers all compensation that's related to their plans, exposing potential conflicts.
The Department of Labor requires certain employers that provide health benefits to file documents every year about their plans, including payments to brokers. The department posts the information on its website.
But the data is notoriously messy. After a 2012 report found 23% of the forms contained errors, there was a proposal to revamp the data collection in 2016. It is unclear if that work was done, but ProPublica tried to analyze the data and found it incomplete or inaccurate. The data shortcomings mean employers have no real ability to compare payments to brokers.
About five years ago, Contorno, one of the leaders in the Rosetta movement, was blithely happy with the status quo: He had his favored insurers and could usually find traditional plans that appeared to fit his clients' needs.
Today, he regrets his role in driving up employers' health costs. One of his LinkedIn posts compares the industry's acceptance of control by insurance companies to Stockholm Syndrome, the feelings of trust a hostage would have toward a captor.
Contorno began advising Palmer Johnson in 2016. When he took over, the company had a self-funded plan and its claims were reviewed by an administrator owned by its broker, Iowa-based Cottingham & Butler. Contorno brought in an independent claims administrator who closely scrutinized the claims and provided detailed cost information. The switch led to significant savings, said Parsons, the company owner. "It opened our eyes to what a good claims review process can mean to us," he said.
Brad Plummer, senior vice president for employee benefits for Cottingham & Butler, acknowledged "things didn't go swimmingly" with the claims company. But overall his company provided valuable service to Palmer Johnson, he said.
Contorno also provided resources to help Palmer Johnson employees find high-quality, low-cost providers, and the company waived any out-of-pocket expense as an incentive to get employees to see those medical providers. If a patient needed an out-of-network procedure, the price was negotiated up front to avoid massive surprise bills to the plan or the patient.
The company also contracted with a vendor for drug coverage that does not use the secret rebates and hidden pricing schemes that are common in the industry. Palmer Johnson's yearly healthcare costs per employee dropped by more than 25%, from about $11,252 in 2015 to $8,288 in 2018. That's lower than they'd been in 2011, Contorno said.
"Now that my compensation is fully tied to meeting the clients' goals, that is my sole objective," he said. "Your broker works for whoever is cutting them the check."
ProPublica data fellow Sophie Chou contributed to this story.
Marshall Allen is a reporter at ProPublica investigating the cost and quality of our healthcare.
When Congress passed a bill last year to transform the Department of Veterans Affairs, lawmakers said they were getting rid of arbitrary rules for when the government would pay for veterans to see private doctors.
Under the old program, veterans could go to the private sector if they would have to wait 30 days or travel 40 miles for care in the VA. Lawmakers and veteransgroups, including conservatives, criticized those rules as arbitrary. The new law, known as the Mission Act, was supposed to let doctors and patients decide whether to use private sector based on individualized health needs.
On Wednesday, the Trump administration proposed new rules, known as access standards, to automatically make veterans eligible for private care. Instead of 30 days, it's 20 days for primary care or 28 days for specialty care. Instead of 40 miles, it's a 30-minute drive for primary care or a 60-minute drive for specialty care.
The announcement appeared to do little to settle the debate over whether the VA's rules are arbitrary.
"Twenty days is just as arbitrary as 30 days," Bob Wallace, the executive director of Veterans of Foreign Wars, one of the largest veterans service organizations, said in a statement.
What is clear about the new rules is that they are dramatically more permissive. The new drive-time standard alone will make 20% of veterans eligible for private primary care and 31% eligible for private specialty care, up from 8% for both kinds of care under the old program, according to a briefing document circulated on Capitol Hill.
"This is doubling down on the administrative rules such as drive times and wait times," said David Shulkin, the former VA secretary who was fired last year by President Donald Trump, in part over disagreements about this bill. "I was in favor of a system that was clinically based, that put veterans' needs first and allowed the right match of services. This is just changing and loosening the administrative rules."
VA spokeswoman Susan Carter declined to comment.
Last month, a ProPublica investigation of the private-care program that the administration is now expanding found overhead costs that were much higher than industry standards and comparable government programs. In response to the article, VA Secretary Robert Wilkie acknowledged that the agency was "taken advantage of" with these overhead costs and vowed to improve.
On the campaign trail, Trump presented himself as a champion for veterans, and as president he frequently boasts about what his administration has done for former service members. But at the same time, he has enthusiastically supported shifting more veterans to private medical care, over the objection of major veterans groups that want to preserve the VA's health system. He has also plunged the VA into chaos by upending his own leadership team at the agency and handing vast influence to three men nicknamed the "Mar-a-Lago Crowd" because they meet at the president's resort in Florida.
The new access standards are the most important step toward reshaping the VA in line with Trump's vision of enlarging the private sector’s role.
"None of this should be a surprise to anybody: President Trump has made it clear from pretty much the moment he started running he wanted full choice," said Dan Caldwell, the executive director of Concerned Veterans for America, a political group that advocates for more private care and that is backed by the Koch brothers, the industrialists who have donated hundreds of millions of dollars to conservative causes. "This does get us closer to full choice. That's the model we want to get to."
The VA is planning to continue widening the access standards, dropping the wait time for primary care to 14 days in 2020, according the agency’s briefing materials.
Already, according to the document, almost half of the VA's primary care sites (69 out of 141) have wait times longer than 20 days, meaning their patients could get private care. In gastroenterology, 81 out of 128 sites have waits longer than 28 days. But, the document cautioned, "This data is not reliable."
According to people present for briefings on Wednesday, congressional staff and veterans groups had a long list of questions that largely went unanswered by VA officials. Among them:
How many more veterans will become eligible for private care based on the wait times standards?
How does the software that the VA bought from Microsoft calculate drive times?
How many more patients does the VA expect to choose private care?
How many more private-sector appointments does the VA expect to pay for?
How many more veterans will sign up for VA benefits, or use the VA instead of their other insurance coverage, now that they could see private doctors at no cost to them?
How will the VA ensure, as required by the Mission Act, that veterans referred to the private sector can get appointments there sooner than they could in the VA? (The VA's briefing materials said average national wait times are higher than in the VA.)
"They just didn't provide a whole lot of answers to questions about the impact," said Carl Blake, Paralyzed Veterans of America's executive director. "The fact is it's going to open up eligibility. It's debatable whether there are adequate resources to do so. What won't be acceptable is for them to take money from other programs in the VA to pay for it."
The unanswered questions could dramatically change the program's cost. The official notice for the new rules on the website for the Office of Information and Regulatory Affairs says the "Anticipated Costs and Benefits" are "TBD." In Wednesday's briefings, officials said the new access standards will increase the agency's expenses by $2.7 billion to $3.1 billion next year and by $19 billion to $20 billion over five years, the people present said.
Lawmakers have cast doubt on the VA's cost projections. In aletter to Wilkie on Monday, 28 Democratic senators noted that officials had provided "widely varying and potentially contradictory" figures depending on the day.
"I don’t know why they’re not using the resources we used to model this," said Nancy Schlichting, the former CEO of the Henry Ford Health System who led a congressionally chartered commission that in 2016 issued a report on the VA's future. The commission estimated that paying for veterans to see private doctors without a referral from the VA could increase costs by $96 billion to $179 billion a year.
"It's very, very unsophisticated, frankly," Schlichting said of the administration's proposal.
When debating the Mission Act, lawmakers relied on a projection by the nonpartisan Congressional Budget Office that assumedthe rate of veterans using the private sector would stay about the same. That assumption has now been blown up by the way the administration is implementing the law.
"Today's announcement hastily rolling out new access standards places core VA services and vital research programs at risk by shifting money towards care outside VA," House veterans committee chairman Mark Takano said in a statement on Wednesday, vowing to hold a hearing. "Today's announcement places VA on a pathway to privatization and leads Congress to assume the worst."
Wilkie had moved to pre-empt such criticism. "Some will claim falsely and predictably that they represent a first step toward privatizing the department," he said in alengthy statementon Monday, two days before the news access standards were announced.
As evidence, Wilkie said appointments in the VA's health system have increased by 3.4 million since 2014 to more than 58 million in 2018. But his statement did not mention how much the VA's private-sector appointments have grown: more than four times as much. According to agency data provided to ProPublica, the VA’s private-care appointments increased by 14.9 million since 2014 to 33.2 million in 2017. Private care accounted for 58% of the VA's total outpatient appointments in 2017, up from 33% in 2014, the data shows.
In developing these access standards, Wilkie relied extensively on Darin Selnick, who previously worked for Concerned Veterans for America, the organization supported by the Koch brothers. Selnick signed onto an infamous 2016 proposalto dismantle the VA’s government-run health system. Selnick alsoworked closely withthe trio of unofficial advisers known as the "Mar-a-Lago Crowd."
Selnick sat on the "executive steering committee" in charge of implementing the Mission Act and reported directly to Wilkie as a senior adviser, according to an organization chart obtained by ProPublica. However, when the VA presented a version of the same chart to Congress at a December hearing, Selnick's name was not there.
Lawmakers voted for the Mission Act with the understanding that access standards would automatically trigger private care for only a few kinds of services, such as lab tests, X-rays and urgent care, the 28 Senate Democrats said. But now the administration is making the access standards apply to everything, a plan that ProPublica first revealedin November.
"This proposal risks needlessly siphoning away VA resources to private providers, which could irresponsibly starve excellent existing VA clinics and hospitals," Senate veterans committee member Richard Blumenthal, D-Conn., said in a statement on Wednesday.
Lawmakers and the public may not get more information about the how the program will be funded until the White House releases its budget for 2020. But officials have indicatedthey won't submit the president's budget to Congress on time, blaming the 35-day partial government shutdown. The shutdown did not affect the VA, but it did furlough staff in the Office of Management and Budget, putting the VA at risk of being late on the Mission Act regulations that are due in June, according to an agency report obtained by ProPublica.
The VA recently choseOptum, a division of UnitedHealth Group, to take over administering the new private-care program in most of the country. However, because the agency was late in awarding the contracts, Optum won't be ready to start when the new program is supposed to take effect in June.
In the interim, program will be run by TriWest Healthcare Alliance, the old vendor that charged unusually high fees. TriWest has also filed a formal protest challenging the VA’s decision to hire Optum. The dispute will be adjudicated by the Government Accountability Office.
In one case, a patient claims a surgeon sewed a major vein closed, causing blood to back up in his head. In the other, a patient alleges that the same surgeon sewed through his colon, filling his abdomen with feces. The lawsuits follow a yearlong investigation by ProPublica and the Houston Chronicle.
This article first appeared January 17, 2019, on ProPublica.
Two new lawsuits have been filed against Baylor St. Luke's Medical Center by patients who say they suffered serious injuries as a result of surgical errors during heart transplants at the troubled Houston hospital.
The suits, both filed Friday in Harris County District Court, bring to five the number of malpractice complaints involving heart transplants that have been leveled against St. Luke's or its doctors since a Houston Chronicle and ProPublica investigation last yeardocumented deaths and unexpected complications in the once-renowned program.
In one of the lawsuits filed last week, Lazerick Eskridge alleges that Dr. Jeffrey Morgan sewed a major vein closed during his heart transplant in February 2017, causing blood to back up into his head and requiring an emergency repair in the operating room. That led to several serious complications and resulted in a three-month hospital stay, according to the lawsuit.
In the other case, Ronald Coleman alleges that Morgan sutured his colon to his diaphragm during his heart transplant in October 2016, damaging the digestive organ and causing Coleman's abdomen to fill with feces. That caused serious infections, the lawsuit says, leading to several follow-up surgeries and "nearly costing Mr. Coleman his life."
Eskridge's story was detailed in a Chronicle and ProPublica report last year. Coleman's case has not been made public before now.
Both patients survived their ordeals but continue to suffer debilitating complications, according to their lawsuits.
St. Luke's and Morgan each declined to comment on the lawsuits, as did Baylor College of Medicine, which is named as a defendant in both cases as Morgan's employer. In previous interviews, all three have defended the quality of care provided to heart recipients at St. Luke's.
Hospital leaders also defended Morgan in past statements and interviews, calling him a skilled surgeon who they said had successfully turned the heart program around after a string of deaths in 2015. The hospital's heart transplant survival rates improved in 2016 and 2017, meeting national benchmarks.
In October, however, after losing Medicare funding, hospital leaders announced they had hired two new heart surgeons, effectively replacing Morgan as leader of the program.
The latest lawsuits come as the federal Centers for Medicare and Medicaid Services conducts a comprehensive investigation into care provided at St. Luke's after the recent death of an emergency room patient who received a transfusion of the wrong blood type. Following that mishap and numerous other care lapses reported by the Chronicle and ProPublica over the past year, the hospital announced Monday that it was replacing its president, its chief nursing officer and a top physician.
Even as the hospital seeks to move forward under new leadership, it continues to deal with fallout from the problems in its heart transplant program. Three otherlawsuitshave already been filed in Harris County on behalf of St. Luke's patients who died or suffered serious complications after receiving new hearts. The hospital has declined to comment on pending litigation and has filed motions denying wrongdoing in two of the earlier cases; the third doesn't name the hospital as a defendant.
The two most recent lawsuits accuse Morgan of making technical mistakes with sutures during surgeries.A similar problem occured in one of his first transplant operations after taking over as the top heart transplant surgeon at St. Luke's in 2016, according to six medical professionals familiar with the case.
In that case, doctors and hospital staffers told reporters that Morgan sewed shut another major vein that carries blood back to the heart, and the patient died a few weeks later. The patient's family has not filed suit and Morgan has not commented on the situation, citing patient privacy.
In the case of Eskridge, Morgan said in a statement last year that his vein tissue was "severely abnormal" because of past cancer treatments and also was distorted by wires attached to the cardiac devices in his chest. Morgan said he used sutures to reinforce the vein's connection to the heart, but due to "concern for narrowing," he had to perform an operation to bypass the vein.
According to Coleman's lawsuit, he struggled to recover after receiving a new heart in October 2016. More than two weeks passed before an abdominal surgeon discovered what had gone wrong, according to the lawsuit. Part of his colon had to be removed as a result.
Coleman suffered life-threatening infections in the weeks that followed, the lawsuit says. He remained in the hospital for three months.
Because Coleman and Eskridge survived one year after their transplants, both of their surgeries are considered successes based on the main metric used to calculate transplant program mortality rates, and both contribute to the hospital's claim of improved outcomes in recent years.
The lawsuits, which were filed by separate law firms, both accuse Morgan of omitting key details about what went wrong when filling out operative reports in the patients' medical files, a violation of protocol that makes it more difficult to provide timely treatment.
Both lawsuits also accuse St. Luke's of "malicious credentialing" for allowing Morgan to continue operating after receiving complaints from several physicians about his surgical abilities, as reported last year by the Chronicle and ProPublica. At least two cardiologists grew so troubled, they said they began referring some patients to competing hospitals for transplants.
Morgan remains on the faculty at Baylor and still has privileges at St. Luke's, officials have said. But he no longer holds his previous title as surgical chief of heart transplants at either institution.
The sudden removal of the three executives follows a yearlong investigation by ProPublica and the Houston Chronicle into widespread problems at the hospital, including deaths in its heart transplant program.
This article first appeared January 14, 2019 on ProPublica.
Baylor St. Luke's Medical Center has ousted its president, its chief nursing officer and a top physician following numerous reports of substandard care, including a recent mistake that led to a patient's death, the Houston hospital announced Monday.
The hospital board's decision to replace top management comes in direct response to a recent error in which an emergency room patient died after receiving a blood transfusion with the wrong blood type, the hospital said in a news release announcing the changes.
Bob Moos, a spokesman for CMS, said that a team of 11 federal and state inspectors visited St. Luke's last week to complete a comprehensive investigation.
"The next steps will be determined from that review," Moos said.
Marc Shapiro, chairman of the St. Luke's board of directors, said in a statement that the nonprofit hospital "has faced significant challenges over the last year," and in light of the most recent incident, the board determined "aggressive action" was needed.
The latest Medicare review "raises concerns that are simply unacceptable to the Board," Shapiro said.
Doug Lawson, a regional executive with Catholic Health Initiatives, which owns the hospital, will replace Gay Nord as president, the hospital said in the news release. Lawson will continue in his role as CEO of CHI's Texas Division, which oversees St. Luke's and 15 other hospitals across the state.
A hospital spokesman said Lawson was not available for an interview and referred reporters to the hospital's news release.
In a statement, Lawson said the hospital is developing a 90-day plan that "will include new initiatives in the areas of clinical excellence, patient experience, and workplace culture. We are committed to taking all steps necessary to keep us on the path of excellence and to earn the trust of our patients."
Jennifer Nitschmann, the hospital's chief nursing officer, and Dr. David Berger, the hospital's senior vice president of operations, also "have left their roles," the hospital announced. Berger declined to comment for this story; Nord and Nitschmann could not be reached.
Dr. Ashish Jha, the director of Harvard's Global Health Institute and an expert in hospital quality measures, said hospitals nationwide have set up robust systems to prevent patients from receiving transfusions of the wrong blood type, a deadly and rare mistake.
"So for that to fall apart really does say to me, in the context of everything else going on, that there was really a deeper systemic problem," Jha said, emphasizing that such an error is even more remarkable at a major teaching hospital such as St. Luke's. "Whether changing leadership is going to fix it, I don't know ... but, of course, holding people to account is critically important."
The sudden departures are a stunning turn for a hospital renowned for its pioneering heart research, conducted with its partners, Texas Heart Institute and Baylor College of Medicine. It was here that Dr. Denton Cooley performed some of the world's first heart transplants and where Dr. O.H. "Bud" Frazier has worked to develop a mechanical replacement for the human heart.
St. Luke's, founded in 1954 by the Episcopal Diocese of Texas, is a behemoth in the Texas Medical Center, with 850 licensed beds, nearly 4,000 employees and 7,500 physicians.
For months, St. Luke's leaders had steadfastly defended the quality of care provided at the hospital. Following news reports last year about problems within the heart transplant program and other patient care concerns, the hospital launched a website and purchased full-page newspaper advertisements challenging the reporting and defending its medical care.
In an interview in August, Berger acknowledged that St. Luke's had struggled to meet national quality benchmarks in the years immediately after CHI purchased the hospital in 2013, but he said those issues were in the past. After Nord's arrival in 2016, Berger said administrators had invested additional resources in the hospital's quality department, strengthened its physician-leadership structure and worked with doctors and nurses to find ways to improve outcomes.
"The issues that you're bringing to light focus on a period of time in the institution when there were some challenges," Berger told reporters. "But I think our current data, which shows really excellent outcomes both from patient safety and from quality, would show that those issues are no longer pertinent. ... Those are historical issues."
In an interview Monday, Baylor College of Medicine President and CEO Paul Klotman said St. Luke's has made significant progress in improving care in the five years since it entered a joint-operating agreement with the medical school. But he said a mistake as serious as giving a patient a transfusion with the wrong blood type should never happen.
"There are certain things that reach a threshold where you've got to make a statement, where you've got to change the leadership and direction to get everyone's attention," said Klotman, who also sits on the St. Luke's hospital board. "This is one of those things."
Klotman said he does not believe Medicare's decision to cut off funding for heart transplants last year factored in the board's decision to change hospital leadership. He said the problems that triggered federal scrutiny were limited to a string of heart transplant patient deaths in 2015 and had since been corrected.
However, the Chronicle and ProPublica investigation documented unusual complications and deaths following heart transplants in 2016 and 2017, prompting some doctors to bring their concerns to Nord and other hospital leaders. At least two cardiologists grew so troubled, they said they began referring some patients to competing hospitals for transplants.
Two weeks after the news organizations published those findings in May, a federal appeals court judge stepped down from the hospital's board of directors, and the hospital announced it was temporarily suspending the heart program following two additional patient deaths in 2018.
The program reopened 14 days later, but within weeks, the federal government stepped in. Medicare announced in June that it would cut off funding for heart transplants at St. Luke's after the agency concluded the hospital had not done enough to improve care. Starting in mid-August, St. Luke's was barred from billing federal health programs for heart transplants. The hospital is appealing that decision.
The problems led more than 100 patients, family members, physicians and other medical professionals to contact the news organizations to report concerns about care at St. Luke's.
In October, after repeatedly defending the quality of the program and its physicians, St. Luke's announced it had hired two doctors to [replace its]{.underline} lead heart transplant surgeon and hired a new executive to oversee all of its transplant programs.
Marilyn Chambers, whose husband, John, died at St. Luke's in April, more than three months after receiving a double-lung transplant, said she believes the hospital needs to do more than change leaders. Chambers filed several complaints about the care provided to her husband, including incidents in which she said she found medication intended for another patient in her husband's room.
In a pair of meetings with Marilyn Chambers last year, Nord acknowledged that her staff could have done a better job caring for Chambers' husband and said the hospital had educated staff based on some of her complaints.
It wasn't enough, Chambers said.
"I can't get over it," she said. "It's been eight months, and I'm still crying like it's yesterday. Everything is just so unresolved, and I can't get anybody to do anything."
Dr. José Baselga, who resigned his position as the top doctor at Memorial Sloan Kettering Cancer Center after failing to disclose millions of dollars in payments from drug companies, is now going to work for one of them.
AstraZeneca, the British-Swedish drug maker, announced on Monday that it had hired Dr. Baselga as its head of research and development in oncology, a newly created unit that reflects the company's shift toward cancer treatments, one of the hottest areas in the drug industry.
In a statement, AstraZeneca's chief executive, Pascal Soriot, described Baselga as "an outstanding scientific leader." "José's research and clinical achievements have led to the development of several innovative medicines, and he is an international thought leader in cancer care and clinical research," he said.
Baselga stepped down in September from his role as chief medical officer at the cancer center after The New York Times and ProPublica reported that he had failed to accurately disclose his conflicts of interest in dozens of articles in medical journals. He later resigned from the boards of the drug maker Bristol-Myers Squibb and the radiation equipment manufacturer Varian Medical Systems.
Although Memorial Sloan Kettering has said that Baselga was not fired, hospital leaders have indicated that he was forced out. In October, Douglas A. Warner III, then the chairman of the cancer center's board, told the staff that Baselga's actions "left us no choice."
In December, the American Association for Cancer Research said that Baselga, at its request, had resigned his post as one of two editors in chief of its medical journal Cancer Discovery because he did "not adhere to the high standards" of conflict-of-interest disclosures that the group expects of its leaders. Some of his omissions involved articles that were published in Cancer Discovery while he was an editor in chief.
A spokesman for AstraZeneca said Baselga was not available for comment, but the doctor told Reuters on Monday that he took responsibility for his disclosure lapses. He also said the cancer association had concluded his failures were "inadvertent," and said many of his company relationships were publicly available on a federal database of physician payments by drug and device manufacturers. However, some of the relationships that Baselga failed to disclose were with small biotech startups that are not required to report to the federal government.
"Dr. Baselga is one of the best scientists in the field of oncology," said the spokesman, Gonzalo Viña. "We evaluated the series of inadvertent omissions, which have since been addressed and it is not for us to comment about the previous roles he held."
AstraZeneca paid Baselga $28,750 for consulting work in 2013 and 2014 related to unspecified drugs, according to the federal database. He failed to disclose any relationships with companies, including AstraZeneca, in dozens of articles in recent years.
Baselga, 59, is an expert in breast cancer research and played a key role in the development of Herceptin by Genentech, a subsidiary of Roche. He came to Memorial Sloan Kettering in 2013 after serving as chief of hematology and oncology at Massachusetts General Hospital in Boston. Before that, he was a leader at the Vall d'Hebron Institute of Oncology in Barcelona, Spain.
Since September, Baselga has corrected his conflict-of-interest disclosures in several journals, including in The New England Journal of Medicine and in Cancer Discovery. In a note that accompanied Baselga's correction in The New England Journal of Medicine, editors described his failure as a "breach of trust."
AstraZeneca's decision to hire Baselga is part of an effort by the drug maker to focus more directly on cancer research, which has generated extensive interest from investors and companies in recent years amid a series of breakthroughs. The company sells several cancer drugs, including the lung cancer drug Tagrisso and Lynparza, which treats a number of cancers. It has suffered some recent setbacks, such as a failed trial of its lung cancer drug Imfinzi.
Under the company's new structure, Baselga will oversee the development of cancer drugs from early research to late-stage clinical trials, and a separate research unit will focus on other disease areas. Each unit will have its own commercial team to promote the products.
"This new structure will support growth and sharpen the focus on our main therapy areas, speeding up decisions and making us more productive in our mission to bring innovative medicines to patients," Soriot said in the statement.
In the same statement, Baselga described his new role as a "dream job" and said the reorganization will "accelerate our work to bring transformative medicines to patients."
For years, conservatives have assailed the U.S. Department of Veterans Affairs as a dysfunctional bureaucracy. They said private enterprise would mean better, easier-to-access health care for veterans. President Donald Trump embraced that position, enthusiastically moving to expand the private sector's role.
Here's what has actually happened in the four years since the government began sending more veterans to private care: longer waits for appointments and, a new analysis of VA claims data by ProPublica and PolitiFact shows, higher costs for taxpayers.
Since 2014, 1.9 million former service members have received private medical care through a program called Veterans Choice. It was supposed to give veterans a way around long wait times in the VA. But their average waits using the Choice Program were still longer than allowed by law, according to examinations by the VA inspector general and the Government Accountability Office. The watchdogs also found widespread blunders, such as booking a veteran in Idaho with a doctor in New York and telling a Florida veteran to see a specialist in California. Once, the VA referred a veteran to the Choice Program to see a urologist, but instead he got an appointment with a neurologist.
The winners have been two private companies hired to run the program, which began under the Obama administration and is poised to grow significantly under Trump. ProPublica and PolitiFact obtained VA data showing how much the agency has paid in medical claims and administrative fees for the Choice program. Since 2014, the two companies have been paid nearly $2 billion for overhead, including profit. That's about 24 percent of the companies' total program expenses — a rate that would exceed the federal cap that governs how much most insurance plans can spend on administration in the private sector.
According to the agency's inspector general, the VA was paying the contractors at least $295 every time it authorized private care for a veteran. The fee was so high because the VA hurriedly launched the Choice Program as a short-term response to a crisis. Four years later, the fee never subsided — it went up to as much as $318 per referral.
"This is what happens when people try and privatize the VA," Sen. Jon Tester of Montana, the ranking Democrat on the Senate veterans committee, said in a statement responding to these findings. "The VA has an obligation to taxpayers to spend its limited resources on caring for veterans, not paying excessive fees to a government contractor. When VA does need the help of a middleman, it needs to do a better job of holding contractors accountable for missing the mark."
The Affordable Care Act prohibits large group insurance plans from spending more than 15 percent of their revenue on administration, including marketing and profit. The private sector standard is 10 percent to 12 percent, according to Andrew Naugle, who advises health insurers on administrative operations as a consultant at Milliman, one of the world's largest actuarial firms. Overhead is even lower in the Defense Department's Tricare health benefits program: only 8 percent last year.
Even excluding the costs of setting up the new program, the Choice contractors' overhead still amounts to 21 percent of revenue.
"That's just unacceptable," Rick Weidman, the policy director of Vietnam Veterans of America, said in response to the figures. "There are people constantly banging on the VA, but this was the private sector that made a total muck of it."
A spokesman for the VA, Curt Cashour, declined to provide an interview with key officials and declined to answer a detailed list of written questions.
One of the contractors, Health Net, stopped working on the program in September. Health Net didn't respond to requests for comment.
The other contractor, TriWest Healthcare Alliance, said it has worked closely with the VA to improve the program and has made major investments of its own. "We believe supporting VA in ensuring the delivery of quality care to our nation's veterans is a moral responsibility, even while others have avoided making these investments or have withdrawn from the market," the company said in a statement.
TriWest did not dispute ProPublica and PolitiFact's estimated overhead rate, which used total costs, but suggested an alternate calculation, using an average cost, that yielded a rate of 13 percent to 15 percent. The company defended the $295-plus fee by saying it covers "highly manual" services such as scheduling appointments and coordinating medical files. Such functions are not typically part of the contracts for other programs, such as the military's Tricare. But Tricare's contractors perform other duties, such as adjudicating claims and monitoring quality, that Health Net and TriWest do not. In a recent study comparing the programs, researchers from the Rand Corporation concluded that the role of the Choice Program's contractors is "much narrower than in the private sector or in Tricare."
Before the Choice Program, TriWest and Health Net performed essentially the same functions for about a sixth of the price, according to the VA inspector general. TriWest declined to break down how much of the fee goes to each service it provides.
Because of what the GAO called the contractors' "inadequate" performance, the VA increasingly took over doing the Choice Program's referrals and claims itself.
In many cases, the contractors' $295-plus processing fee for every referral was bigger than the doctor's bill for services rendered, the analysis of agency data showed. In the three months ending Jan. 31, 2018, the Choice Program made 49,144 referrals for primary care totaling $9.9 million in medical costs, for an average cost per referral of $201.16. A few other types of care also cost less on average than the handling fee: chiropractic care ($286.32 per referral) and optometry ($189.25). There were certainly other instances where the medical services cost much more than the handling fee: TriWest said its average cost per referral was about $2,100 in the past six months.
Beyond what the contractors were entitled to, audits by the VA inspector general found that they overcharged the government by $140 million from November 2014 to March 2017. Both companies are now under federal investigation arising from these overpayments. Health Net's parent company, Centene, disclosed a Justice Department civil investigation into "excessive, duplicative or otherwise improper claims." A federal grand jury in Arizona is investigating TriWest for "wire fraud and misused government funds," according to a court decision on a subpoena connected to the case. Both companies said they are cooperating with the inquiries.
Despite the criminal investigation into TriWest's management of the Choice Program, the Trump administration recently expanded the company's contract without competitive bidding. Now, TriWest stands to collect even more fees as the administration prepares to fulfill Trump's campaign promise to send more veterans to private doctors.
Senate veterans committee chairman Johnny Isakson, R-Ga., said he expects VA Secretary Robert Wilkie to discuss the agency's plans for the future of private care when he testifies at a hearing on Wednesday. A spokeswoman for the outgoing chairman of the House veterans committee, Phil Roe, R-Tenn., didn't respond to requests for comment.
"The last thing we need is to have funding for VA's core mission get wasted," Rep. Mark Takano, a California Democrat who will become the House panel's chairman in January, said in a statement. "I will make sure Congress conducts comprehensive oversight to ensure that our veterans receive the care they deserve while being good stewards of taxpayer dollars."
Many of the Choice Program's defects trace back to its hasty launch.
In 2014, the Republican chairman of the House veterans committee alleged that 40 veterans died waiting for care at the VA hospital in Phoenix. The inspector general eventually concluded that no deaths were attributable to the delays. But it was true that officials at the Phoenix VA were covering up long wait times, and critics seized on this scandal to demand that veterans get access to private medical care.
One of the loudest voices demanding changes was John McCain's. "Make no mistake: This is an emergency," the Arizona senator, who died in August, said at the time. McCain struck a compromise with Democrats to open up private care for veterans who lived at least 40 miles from a VA facility or would have to wait at least 30 days to get an appointment.
In the heat of the scandal, Congress gave the VA only 90 days to launch Choice. The VA reached out to 57 companies about administering the new program, but the companies said they couldn't get the program off the ground in just three months, according to contracting records. So the VA tacked the Choice Program onto existing contracts with Health Net and TriWest to run a much smaller program for buying private care. "There is simply insufficient time to solicit, evaluate, negotiate and award competitive contracts and then allow for some form of ramp-up time for a new contractor," the VA said in a formal justification for bypassing competitive bidding.
But that was a shaky foundation on which to build a much larger program, since those earlier contracts were themselves flawed. In a 2016 report, the VA inspector general said officials hadn't followed the rules "to ensure services acquired are based on need and at fair and reasonable prices." The report criticized the VA for awarding higher rates than one of the vendors proposed.
The new contract with the VA was a lifeline for TriWest. Its president and CEO, David J. McIntyre Jr., was a senior aide to McCain in the mid-1990s before starting the company, based in Phoenix, to handle health benefits for the military's Tricare program. In 2013, TriWest lost its Tricare contract and was on the verge of shutting down. Thanks to the VA contract, TriWest went from laying off more than a thousand employees to hiring hundreds.
McIntyre's annual compensation, according to federal contracting disclosures, is $2.36 million. He declined to be interviewed. In a statement, TriWest noted that the original contract, for the much smaller private care program, had been competitively awarded.
The VA paid TriWest and Health Net $300 million upfront to set up the new Choice program, according to the inspector general's audit. But that was dwarfed by the fees that the contractors would collect. Previously, the VA paid the companies between $45 and $123 for every referral, according to the inspector general. But for the Choice Program, TriWest and Health Net raised their fee to between $295 and $300 to do essentially the same work on a larger scale, the inspector general said.
The price hike was a direct result of the time pressure, according to Greg Giddens, a former VA contracting executive who dealt with the Choice Program. "If we had two years to stand up the program, we would have been at a different price structure," he said.
Even though the whole point of the Choice Program was to avoid 30-day waits in the VA, a convoluted process made it hard for veterans to see private doctors any faster. Getting care through the Choice Program took longer than 30 days 41 percent of the time, according to the inspector general's estimate. The GAO found that in 2016 using the Choice Program could take as long as 70 days, with an average of 50 days.
Sometimes the contractors failed to make appointments at all. Over a three-month period in 2018, Health Net sent back between 9 percent and 13 percent of its referrals, according to agency data. TriWest failed to make appointments on 5 percent to 8 percent of referrals, the data shows.
Many veterans had frustrating experiences with the contractors.
Richard Camacho in Los Angeles said he got a call from TriWest to make an appointment for a sleep test, but he then received a letter from TriWest with different dates. He had to call the doctor to confirm when he was supposed to show up. When he got there, the doctor had received no information about what the appointment was for, Camacho said.
John Moen, a Vietnam veteran in Plano, Texas, tried to use the Choice Program for physical therapy this year rather than travel to Dallas, where the VA had a six-week wait. But it took 10 weeks for him to get an appointment with a private provider.
"The Choice Program for me has completely failed to meet my needs," Moen said.
Curtis Thompson, of Kirkland, Washington, said he's been told the Choice Program had a 30-day wait just to process referrals, never mind to book an appointment. "Bottom line: Wait for the nearly 60 days to see the rheumatologist at the VA rather than opt for an unknown delay through Veterans Choice," he said.
After Thompson used the Choice Program in 2018 for a sinus surgery that the VA couldn't perform within 30 days, the private provider came after him to collect payment, according to documentation he provided.
Thousands of veterans have had to contend with bill collectors and credit bureaus because the contractors failed to pay providers on time, according to the inspector general. Doctors have been frustrated with the Choice Program, too. The inspector general found that 15 providers in North Carolina stopped accepting patients from the VA because Health Net wasn't paying them on time.
The VA shares the blame, since it fell behind in paying the contractors, the inspector general said. TriWest claimed the VA at one point owed the company $200 million. According to the inspector general, the VA's pile of unpaid claims peaked at almost 180,000 in 2016 and was virtually eliminated by the end of the year.
The VA tried to tackle the backlog of unpaid doctors, but it had a problem: The agency didn't know who was performing the services arranged by the contractors. That's because Health Net and TriWest controlled the provider networks, and the medical claims they submit to the VA do not include any provider information.
The contractors' role as middlemen created the opportunity for payment errors, according to the inspector general's audit. The inspector general found 77,700 cases where the contractors billed the VA for more than they paid providers and pocketed the difference, totaling about $2 million. The inspector general also identified $69.9 million in duplicate payments and $68.5 million in other errors.
TriWest said it has worked with the VA to correct the payment errors and set aside money to pay back. The company said it's waiting for the VA to provide a way to refund the confirmed overpayments. "We remain ready to complete the necessary reconciliations as soon as that process is formally approved," TriWest said.
The grand jury proceedings involving TriWest are secret, but the investigation became public because prosecutors sought to obtain the identities of anonymous commenters on the jobs website Glassdoor.com who accused TriWest of "mak[ing] money unethically off of veterans/VA." Glassdoor fought the subpoena but lost, in November 2017. The court's opinion doesn't name TriWest, but it describes the subject of the investigation as "a government contractor that administers veterans' healthcare programs" and quotes the Glassdoor reviews about TriWest. The federal prosecutor's office in Arizona declined to comment.
"TriWest has cooperated with many government inquiries regarding VA's community care programs and will continue to do so," the company said in its statement. "TriWest must respect the government's right to keep those inquiries confidential until such time as the government decides to conclude the inquiry or take any actions or adjust VA programs as deemed appropriate."
The VA tried to make the Choice Program run more smoothly and efficiently. Because the contractors were failing to find participating doctors to treat veterans, the VA in mid-2015 launched a full-court press to sign up private providers directly, according to the inspector general. In some states, the VA also took over scheduling from the contractors.
"We were making adjustments on the fly trying to get it to work," said David Shulkin, who led the VA's health division starting in 2015. "There needed to be a more holistic solution."
Officials decided in 2016 to design new contracts that would change the fee structure and reabsorb some of the services that the VA had outsourced to Health Net and TriWest. The department secretary at the time, Bob McDonald, concluded the VA needed to handle its own customer service, since the agency's reputation was suffering from TriWest's and Health Net's mistakes. Reclaiming those functions would have the side effect of reducing overhead.
"Tell me a great customer service company in the world that outsources its customer service," McDonald, who previously ran Procter & Gamble, said in an interview. "I wanted to have the administrative functions within our medical centers so we took control of the care of the veterans. That would have brought that fee down or eliminated it entirely."
The new contracts, called the Community Care Network, also aimed to reduce overhead by paying the contractors based on the number of veterans they served per month, rather than a flat fee for every referral. To prevent payment errors like the ones the inspector general found, the new contracts sought to increase information-sharing between the VA and the contractors. The VA opened bidding for the new Community Care Network contracts in December 2016.
But until those new contracts were in place, the VA was still stuck paying Health Net and TriWest at least $295 for every referral. So VA officials came up with a workaround: they could cut out the middleman and refer veterans to private providers directly. Claims going through the contractors declined by 47 percent from May to December in 2017.
TriWest's CEO, McIntyre, objected to this workaround and blamed the VA for hurting his bottom line.
In a Feb. 26, 2018, email with the subject line "Heads Up… Likely Massive and Regrettable Train Wreck Coming!" McIntyre warned Shulkin, then the department secretary, that "long unresolved matters with VA and current behavior patterns will result in a projected $65 million loss next year. This is on top of the losses that we have amassed over the last couple years."
Officials were puzzled that, despite all the VA was paying TriWest, McIntyre was claiming he couldn't make ends meet, according to agency emails provided to ProPublica and PolitiFact. McIntyre explained that he wanted the VA to waive penalties for claims that lacked adequate documentation and to pay TriWest an administrative fee on canceled referrals and no-show appointments, even though the VA read the contract to require a fee only on completed claims. In a March letter to key lawmakers, McIntyre said the VA's practice of bypassing the contractors and referring patients directly to providers "has resulted in a significant drop in the volume of work and is causing the company irreparable financial harm."
McIntyre claimed the VA owed TriWest $95 million and warned of a "negative impact on VA and veterans that will follow" if the agency didn't pay. Any disruptions at TriWest, he said, would rebound onto the VA, "given how much we are relied on by VA at the moment and the very public nature of this work."
But when the VA asked to see TriWest's financial records to substantiate McIntyre's claims, the numbers didn't add up, according to agency emails.
McIntyre's distress escalated in March, as the Choice Program was running out of money and lawmakers were locked in tense negotiations over its future. McIntyre began sending daily emails to the VA officials in charge of the Choice Program seeking updates and warning of impending disaster. "I don't think the storm could get more difficult or challenging," he wrote in one of the messages. "However, I know that I am not alone nor that the impact will be confined to us."
McIntyre lobbied for a bill to permanently replace Choice with a new program consolidating all of the VA's methods of buying private care. TriWest even offered to pay veterans organizations to run ads supporting the legislation, according to emails discussing the proposal. Congress overwhelmingly passed the law (named after McCain) in May.
"In the campaign, I also promised that we would fight for Veterans Choice," Trump said at the signing ceremony in June. "And before I knew that much about it, it just seemed to be common sense. It seemed like if they're waiting on line for nine days and they can't see a doctor, why aren't they going outside to see a doctor and take care of themselves, and we pay the bill? It's less expensive for us, it works out much better, and it's immediate care."
The new permanent program for buying private care will take effect in June 2019. The VA's new and improved Community Care Network contracts were supposed to be in place by then. But the agency repeatedly missed deadlines for these new contracts and has yet to award them.
The VA has said it's aiming to pick the contractors for the new program in January and February. Yet even if the VA meets this latest deadline, the contracts include a one-year ramp-up period, so they won't be ready to start in June.
That means TriWest will by default become the sole contractor for the new program. The VA declined to renew Health Net's contract when it expired in September. The VA was planning to deal directly with private providers in the regions that Health Net had covered. But the VA changed course and announced that TriWest would take over Health Net's half of the country. The agency said TriWest would be the sole contractor for the entire Choice Program until it awards the Community Care Network contracts.
"There's still not a clear timeline moving forward," said Giddens, the former VA contracting executive. "They need to move forward with the next program. The longer they stay with the current one, and now that it's down to TriWest, that's not the best model."
Meanwhile, TriWest will continue receiving a fee for every referral. And the number of referrals is poised to grow as the administration plans to shift more veterans to the private sector.
Congress moved a big step closer on Tuesday toward addressing one of the most fundamental problems underlying the maternal mortality crisis in the United States: the shortage of reliable data about what kills American mothers.
The House of Representatives unanimously approved H.R. 1318, the Preventing Maternal Deaths Act, to help states improve how they track and investigate deaths of expectant and new mothers.
The bipartisan bill authorizes $12 million a year in new funds for five years — an unprecedented level of federal support — for states to create review committees tasked with identifying maternal deaths, analyzing the factors that contributed to those deaths and translating the lessons into policy changes. Roughly two-thirds of states have such panels, but the legislation specifically allocates federal funds for the first time and sets out guidelines they must meet to receive those grants.
"We're going to investigate every single [death] because these moms are worth it," Rep. Jaime Herrera Beutler, R-Wash., the lead sponsor, testified at a hearing in September. Lisa Hollier, president of the American College of Obstetricians and Gynecologists, called the legislation a "landmark."
The full Senate still needs to give its approval, with only a few days to act before the end of the current session. Senators have already authorized the necessary funding, in budget legislation that passed this year.
As ProPublica and NPR have documented in the "Lost Mothers" series, maternal deaths have been rising in the U.S. in recent years even as they declined in other wealthy countries. More than 700 women die each year in America from causes related to pregnancy or childbirth, while at least 50,000 suffer life-threatening complications. Nationally, black women have a maternal mortality rate three to four times higher than that of white women. At least 60 percent of maternal deaths are preventable.
Among the reasons the U.S. has fallen behind other countries, one stands out: government failures to collect accurate data and to study maternal deaths and near-deaths to understand how they might be prevented.
State maternal mortality review committees can play a key role in this process, public health experts say. They are particularly critical to understanding and narrowing racial disparities in outcomes. They have uncovered the surprising fact that cardiac-related issues are the leading cause of death for mothers and that the majority of deaths don't occur during childbirth but in the days and weeks after birth.
But many committees have little or no funding and rely on volunteers to do their work. They publish reports irregularly and, in some cases, do not address the issue of preventability at all. As a result, many maternal deaths have gone miscategorized or uncounted, and many researchers and clinicians have formed a distorted picture of why mothers die, often putting the blame unfairly on women themselves instead of medical providers, hospital systems and other factors.
The House bill says that reviews are "essential" for "developing prevention efforts and quality improvement and quality control programs." It adds, "The United States must identify at-risk populations and understand how to support them to make pregnancy and the postpartum period safer." The guidelines for receiving federal funding dictate how committees should be made up and how evaluators should find and count deaths.
Members of Congress have introduced other bills in recent years to try to prod states to establish review committees or strengthen existing ones. But maternal mortality wasn't seen as a serious problem, and the legislation was usually associated with one political party, Democrats. The bills did not gain traction.
The "Lost Mothers" series and a deluge of other media reports changed that, helping to create an unprecedented sense of urgency, maternal health advocates say. "I don't think we would be as far as we are without that," said Kathryn Schubert, chief advocacy officer for the Society for Maternal-Fetal Medicine, whose members are doctors specializing in high-risk pregnancies. "Every day, I get a call from somebody saying: 'Oh my God, this is a real problem. We have to do something,' because they've read it in the news."
The news stories have also inspired mothers who have survived life-threatening complications and relatives of women who died. "It became the call to arms," said Eleni Tsigas, head of the Preeclampsia Foundation and a co-founder of a new coalition of maternal health organizations, MoMMA's Voice.
The nonstop advocacy by patients and doctors — and even groups like March of Dimes, which has traditionally been more focused on infant health — has been effective. "Twelve million dollars [per year] was more than we originally had in the legislation," Schubert said. "That never happens. … They put in money that we didn't even dream of asking for at this point."
The other important factor in the legislation's success has been bipartisanship: The House bill and its Senate companion, S-1112, were introduced by Republicans as well as Democrats, and both have acquired many supporters along the way. Even so, despite having some 190 co-sponsors, the House bill remained stalled in committee for most of the past two years, coming unstuck in recent weeks after a lobbying blitz by medical groups and patient advocates.
Several more-sweeping maternal-related bills are pending on Capitol Hill, and just last week, the Senate approved a bill aimed at reducing chronic shortages of maternity care providers in some parts of the country, sending it to the president to sign. Meanwhile, lawmakers outside Washington have also been active — at least six states have passed bills in the past year establishing or strengthening their maternal mortality review panels.
The dean of Yale's medical school, the incoming president of a prominent cancer group and the head of a Texas cancer center are among leading medical figures who have not accurately disclosed their relationships with drug companies.
This article first appeared December 08, 2018 on ProPublica.
One is dean of Yale's medical school. Another is the director of a cancer center in Texas. A third is the next president of the most prominent society of cancer doctors.
These leading medical figures are among dozens of doctors who have failed in recent years to report their financial relationships with pharmaceutical and health care companies when their studies are published in medical journals, according to a review by ProPublica and The New York Times and data from otherrecent research.
Dr. Howard A. "Skip" Burris III, the president-elect of the American Society of Clinical Oncology, for instance, declared that he had no conflicts of interest in more than 50 journal articles in recent years, including in the prestigious New England Journal of Medicine.
However, drug companies have paid his employer nearly $114,000 for consulting and speaking, and nearly $8 million for his research during the period for which disclosure was required. His omissions extended to the Journal of Clinical Oncology, which is published by the group he will lead.
In addition to the widespread lapses by doctors, the review by ProPublica and The Times found that journals themselves often gave confusing advice and did not routinely vet disclosures by researchers, although many relationships could have been easily detected on a federal database.
Medical journals, which are the main conduit for communicating the latest scientific discoveries to the public, often have an interdependent relationship with the researchers who publish in their pages. Reporting a study in a leading journal can heighten their profile — not to mention that of the drug or other product being tested. And journals enhance their cachet by publishing exclusive, breakthrough studies by acclaimed researchers.
"The system is broken," said Dr. Mehraneh Dorna Jafari, an assistant professor of surgery at the University of California, Irvine, School of Medicine. She and her colleagues published a study in August that found that, of the 100 doctors who received the most compensation from device makers in 2015, conflicts were disclosed in only 37 percent of the articles published in the next year. "The journals aren't checking and the rules are different for every single thing."
Calls for transparency stem from concerns that researchers' ties to the health and drug industries increase the odds they will, consciously or not, skew results to favor the companies with whom they do business. Studies have found that industry-sponsored research tends to be more positive than research financed by other sources. And that in turn can sway which treatments become available to patients. There is no indication that the research done by Burris and the other doctors with incomplete disclosures was manipulated or falsified.
Journal editors say they are introducing changes that will better standardize disclosures and reduce errors. But some have also argued that since most researchers follow the rules, stringent new requirements would be costly and unnecessary.
The issue has gained traction since September, when Dr. José Baselga, the chief medical officer of Memorial Sloan Kettering Cancer Center in New York, resigned after The Times and ProPublica reported that he had not revealed his industry ties in dozens of journal articles.
Burris, president of clinical operations and chief medical officer at the Sarah Cannon Research Institute in Nashville, referred questions to his employer. It defended him, saying the payments were made to the institution, although the New England Journal of Medicine requires disclosure of all such payments.
Other prominent researchers who have submitted erroneous disclosures include Dr. Robert J. Alpern, the dean of the Yale School of Medicine, who failed to disclose in a 2017 journal article about an experimental treatment developed by Tricida that he served on that company's board of directors and owned its stock. Tricida, which is developing therapies for chronic kidney disease, had financed the clinical trial that was the subject of the article.
Alpern said in an email that he initially believed that his disclosure — that he had been a consultant for Tricida — was adequate. However, "because of concerns recently raised about disclosures," he said he notified the publication, the Clinical Journal of the American Society of Nephrology, in October that he also served on Tricida's board and had stock holdings in the company.
The journal initially told Alpern that his disclosure was sufficient. But after ProPublica and The Times contacted the publication in November, it said it would correct the article.
"The failure to disclose this information at the time of peer review is a violation of our policy," Dr. Rajnish Mehrotra, the journal's editor-in-chief, said in an email.
He later said that an additional inquiry had revealed that all 12 of the article's authors had been incomplete in their disclosures, and that the journal planned to refer the matter to the ethics committee of the American Society of Nephrology. Mehrotra also said that the journal had decided to conduct an audit of some recent articles to evaluate the broader issue.
Dr. Carlos L. Arteaga, the director of the Harold C. Simmons Comprehensive Cancer Center in Dallas, said he had "nothing to disclose" as an author of a 2016 study published in The New England Journal of Medicine of the breast cancer drug Kisqali, made by Novartis. But Arteaga had received more than $50,000 from drug companies in the three-year disclosure period, including more than $14,000 from Novartis.
In an email, Arteaga described the omission as an "inexcusable oversight and error on my part," and subsequently submitted a correction.
Dr. Jeffrey R. Botkin, associate vice president for research integrity at the University of Utah, recently argued in JAMA, a leading medical journal, that researchers should face misconduct charges when they do not disclose their relationships with interested companies. "They really are falsifying the information that others rely on to assess that research," he said. "Money is a very powerful influencer, and people's opinions become subtly biased by that financial relationship."
But Dr. Howard C. Bauchner, the editor-in-chief of JAMA, said that verifying each author's disclosures would not be worth the time or effort. "The vast majority of authors are honest and do want to fulfill their obligations to tell readers and editors what their conflicts of interest could be," he said in an interview.
As the debate continues, an influential group, the International Committee of Medical Journal Editors, is considering a policy that would refer researchers who commit major disclosure errors to their institutions for possible charges of research misconduct.
Concerns about the influence of drug companies on medical research have persisted for decades. Senator Estes Kefauver held hearings on the issue in 1959, and there was another surge of concern in the 2000s after a series of scandals in which prominent doctors failed to reveal their industry relationships.
Medical journals and professional societies strengthened their requirements. The drug industry restricted how it compensates doctors, prohibiting gifts like tickets to sporting events or luxury trips — although evidence of kickbacks and corruption continues to surface in criminal prosecutions. And a 2010 federal law required pharmaceutical and device makers to publicly report their payments to physicians.
Despite these changes, the system for disclosing conflicts remains fragmented and weakly enforced. Medical journals and professional societies have a variety of guidelines about what types of relationships must be reported, often leaving it up to the researcher to decide what is relevant. There are few repercussions — beyond a correction — for those who fail to follow the rules.
For example, the American Association for Cancer Research has warned authors that they face a three-year ban if they are found to have omitted a potential conflict. But the group's conflict-of-interest policy contains no mention of such a penalty, and it said no author had ever been barred. Baselga's failure to disclose his industry relationships extended to the association's journal, Cancer Discovery, for which he serves as one of two editors-in-chief. The association said it is investigating Baselga's actions.
Most authors do seem to disclose their ties to corporate interests. About two-thirds of the authors on the Kisqali study, for example, reported relationships with companies, including Novartis. But the researchers who did not included Arteaga, Burris and Denise A. Yardley, a senior investigator who works with Burris at Sarah Cannon.
The Tennessee-based research center received more than $105,000 in fees for consulting, speaking and other services on Yardley's behalf in the three-year period in which she declared no conflicts.
The Sarah Cannon institute said it switched over a year ago to a "universal disclosure" practice promoted by ASCO, the cancer group that Burris will lead. That requires doctors to disclose all payments, including those made to their institutions.
"We believe we adhere to the highest ethical standards in the industry by not allowing personal compensation to be paid to our leadership physicians," the center said.
ASCO said it would post corrections to Burris' disclosures in the Journal of Clinical Oncology for the past four years. The group said that in the fall of 2017 — as Burris was seeking a leadership role in the organization — it began working with him to disclose all his company relationships, including indirect payments. Burris will become president in June 2019.
"Disclosure systems and processes in medicine are not perfect yet, and neither are ASCO's," the group said in an email.
Burris, Yardley and Arteaga submitted updated disclosures to the New England Journal of Medicine, which posted them on Thursday.
Burris' updated disclosure listed relationships with 30 companies, including that he provided expert testimony for Novartis.
Jennifer Zeis, a spokeswoman for the journal, said it was contacting those studies' authors, and that it now asked researchers to certify that they had checked their disclosures against the federal database.
Some institutions have pushed back, arguing that the journals' inconsistent rules make it difficult for even well-meaning researchers to do the right thing.
In a letter last month to the New England Journal of Medicine, Memorial Sloan Kettering objected to the treatment of one of its top researchers, Dr. Jedd Wolchok. When he tried to correct his disclosures, the journal shifted its position, from saying its editors were satisfied with his disclosures to saying he had failed to comply with the rules, the center said in citing communications with the journal.
To clarify reporting requirements, several publications are attempting only now to do what the Institute of Medicine recommended in 2009. The New England Journal is testing a new system in partnership with the Association of American Medical Colleges that would act as a central repository for reporting financial relationships.
This year, JAMA began requiring authors to confirm multiple times that they had nothing to disclose. ASCO has a centralized system for reporting conflicts to all of its journals and speaker presentations.
Dr. Bernard Lo, the chairman of the 2009 Institute of Medicine panel, said journals have only begun to confront some of the systemic flaws. "They're certainly not out in front trying to be trailblazers, let me just say it that way," he said. "The fact that it hasn't been done means that nobody has it on their priority list."
Some patients and family members who came to the Houston hospital for liver and lung transplants have complained about the quality of care provided. A St. Luke's spokeswoman says the transplant programs still meet national benchmarks and argues against focusing on outcomes from a single calendar year.
This article first appeared November 30, 2018 on ProPublica.
During the summer of 2017, Baylor St. Luke's Medical Center posted a banner on its website, celebrating its liver and lung transplant programs as "#1 in Texas."
That declaration was based on the latest publicly available data, which showed stellar one-year survival rates for patients who received liver and lung transplants at St. Luke's between 2014 and the middle of 2016.
But soon after the hospital published those marketing materials in August 2017, both of those transplant programs began to see increases in patient deaths, an investigation by the Houston Chronicle and ProPublica has found.
Of 85 patients who received a liver transplant at St. Luke's in 2017, at least 15 have died within a year, up from previous years and worse than the national average. That's according to preliminary data provided to reporters by the Scientific Registry of Transplant Recipients, a Minnesota-based group that measures transplant outcomes on behalf of the federal government.
Also last year, according to data provided by the registry, at least seven of the hospital's 54 lung recipients died within a year of their transplants, double the mortality rate at the hospital during the previous two and a half years.
These figures do not include patients who received livers or lungs as part of multi-organ transplants or those receiving second transplants after having previously received new organs.
Both the lung and liver programs at St. Luke's have slowed down in 2018, with the number of transplants performed down 40 percent and 16 percent, respectively, through October, compared with the same period last year. Both programs also have had patients suffer unusual complications this year, according to a review of medical records and interviews with surviving family members.
In February, a patient's new lung flipped over inside her chest, an event so rare that experts sometimes document individual cases in medical journals. Another patient developed a serious tear in his airway following his December 2017 lung transplant and never recovered from the setback. And in July, a 36-year-old single mother undergoing a liver transplant died in the operating room, prompting friends to seek donations to pay for her funeral and care for the daughter she left behind.
These deaths came as St. Luke's was facing scrutiny for poor outcomes in its heart transplant program. In May, ProPublica and the Chronicle reported on an outsized number of deaths and complications in that program, which had prompted a couple of St. Luke's cardiologists to refer some patients elsewhere for transplants.
As was the case with the heart program, some patients and family members who came to St. Luke's for liver and lung transplants have complained to administrators or contacted reporters about the quality of care provided.
St. Luke's officials and doctors declined to be interviewed for this story. In a written statement, spokeswoman Marilyn Gerry pointed out that the hospital's liver and lung programs met national benchmarks in the latest official report from the transplant registry, released in October, which measured one-year survival for transplants performed between the start of 2015 and the middle of 2017.
Gerry said it was "misleading" to focus on a single year of data from 2017 rather than the entire two-and-a-half-year period examined by the registry.
"Because of the complex nature of organ transplant cases, natural fluctuations will occur" in a hospital's outcomes from one year to the next, Gerry wrote.
This year, when the Chronicle and ProPublica were reporting on below-average heart transplant outcomes at St. Luke's, hospital officials said something different. They discouraged focusing on the heart program's poor scores in official reports, saying they were based on "old data" and "don't reflect the current transplant outcomes at our institution."
In August, the Centers for Medicare and Medicaid Services terminated federal funding to the heart transplant program after concluding St. Luke's didn't do enough to correct problems that led to poor outcomes dating back to 2015. The hospital is appealing and has said that Medicare's decision has not affected its other transplant programs.
It's too soon to say whether the increase in liver and lung deaths in 2017 will cause those programs to slip below national standards in future registry reports or put them at risk of sanctions from Medicare. That will depend, in part, on how the programs perform in subsequent years, as well as any changes in the way the federal government regulates transplant programs.
Many factors can cause a transplant program's outcomes to dip, experts say, from patient selection to the quality of medical care offered in the months following a transplant. A one-year decline in outcomes may not put a program in jeopardy of falling significantly below national benchmarks, experts say, but it could if a hospital fails to correct the trend.
"Every transplant program has down years," said Alexander Aussi, a San Antonio-based transplant consultant. "But a good program recognizes those trends early, works to understand what is going wrong and then makes proactive changes before things get out of control."
St. Luke's leaders announced in October that they had hired a new executive to oversee all of the hospital's transplant programs and had recruited surgeons to help with heart and lung transplants.
The hospital also has launched a new marketing campaign in recent months celebrating patient success stories, in web vignettes and full-page newspaper ads, often emphasizing St. Luke's willingness to treat the most critically ill patients. One of those was Godfrey "G.W." Biscamp, a 64-year-old former test pilot from Houston who was turned away by two other local transplant programs before getting a new set of lungs at St. Luke's in July 2017.
"I was just about burned out with hospitals," Biscamp said in an interview. "When I went to Baylor, I was kind of expecting the same old song and dance. But those people saved my life."
Biscamp and another organ recipient featured in the ads told reporters they were pleased with the care provided by nurses and physicians throughout their stays at St. Luke's.
Marilyn Chambers, whose husband, John, died in April, more than three months after receiving a double-lung transplant at St. Luke's, tells a different story. She filed several complaints about the care provided to her husband and pressed hospital leaders to explain why he did not survive, leading to a pair of meetings with the hospital's president, Gay Nord.
Chambers said she wasn't satisfied.
"I felt in my soul," she said, "that they did something wrong."
Last year was momentous for the lung transplant program at St. Luke's, following two years of turnover in its surgeon ranks.
The senior surgeon who had led the lung program since 2012 left in the summer of 2015 to practice at a hospital affiliated with Harvard University. The surgeon hired to replace him stopped performing lung transplants soon after his arrival in early 2016, after some of his initial patients experienced complications. And the junior surgeon who stepped in left a few months later, also for a job at a Harvard teaching hospital.
Finally, in the spring of 2017, St. Luke's recruited a 41-year-old surgeon from Minnesota, Dr. Gabriel Loor, and the lung program quickly ramped up. The surge in transplants that year came after another nearby hospital, Houston Methodist, significantly scaled back its lung volume after too many transplants failed within a year.
In Loor's first four months alone, St. Luke's performed 30 lung transplants, nearly matching the hospital's total from all of 2016 and double the number performed in 2015. But soon the program hit a rough patch. At least two of the six patients who received new lungs at the hospital in May 2017 did not survive a year, according to data provided by the United Network for Organ Sharing and interviews with friends and family members.
One of the patients was Leonard "Johnny" Arsement, a former railroad switch operator who came to St. Luke's from Louisiana with pulmonary fibrosis. Days after his transplant, doctors told his family that the donor lungs were not working properly, and he never recovered. He died in December at age 72.
Daniel Butler, an artist from Houston, also received a double-lung transplant that May. The new lungs never seemed to work properly, said his best friend, Tim Johnson. After a series of setbacks early this year, Butler asked St. Luke's doctors to stop providing life-saving medical care, and he died a few days later. He was 62.
"It was just very mysterious to everybody why these lungs wouldn't take," Johnson said. He spoke highly of the doctors and nurses who cared for his friend during his eight-month hospital stay, despite the outcome.
More deaths followed later in the year, threatening to put a drag on the lung program's survival rate in future transplant registry reports. In the two-and-a-half-year period ending in December 2016, 94.2 percent of St. Luke's 58 lung transplant recipients survived one year, better than the hospital's expected rate of 89.7 percent, according to registry figures.
In 2017, though, during the surge in transplant volume, the program's one-year survival rate was down to 87 percent, a couple of percentage points below the national average. The transplant registry does not calculate expected rates for periods shorter than two-and-a-half years. The 2017 survival rate is current as of mid-November and could drop further if any additional lung recipients die in the final weeks of 2018, within one year of their transplants.
The liver transplant program at St. Luke's was in the midst of its own difficult stretch in 2017.
For several years, the liver program had posted outstanding results. Between 2014 and the middle of 2016, 93 percent of its patients survived at least a year, slightly better than the national average of 92 percent and its own expected rate of 91.3 percent.
But that began to shift at the end of 2016, according to an internal chart obtained by the Chronicle and ProPublica. The line graph, used by programs to track transplant outcomes in real time, appears to show the liver program on a steady path toward worse-than-expected outcomes by the end of last year.
All told, one out of every five liver transplants performed at St. Luke's in 2017 have failed within a year, about double the national rate. This includes two St. Luke's patients who had their new livers fail but who were still alive as of this month, likely after receiving another transplant.
Gerry, the St. Luke's spokeswoman, said the internal chart obtained by reporters represents "one piece of a confidential report provided to transplant programs by the [the transplant registry] for peer review and continuous improvement."
A day before Hurricane Harvey slammed into southeast Texas last year, Paul Guillory sat up in a hospital bed at Baylor St. Luke's, telling jokes.
Guillory, a 74-year-old retired barber from League City, was in a good mood, thinking about the months he had waited for a new liver after being diagnosed with cancer, and about the prospect of another decade of life to watch his grandkids grow. His wife, Barbara, scribbled a note in her day planner to document the moment when staff wheeled her husband into surgery on Aug. 24, 2017: "He was so happy," she wrote.
But in the operating room that afternoon, according to medical records, Paul suffered significant blood loss and required multiple transfusions — a complication likely triggered by his liver disease and his body's inability to form blood clots. By the time he'd been wheeled into a recovery room late that night, family members said doctors were expressing grave concerns about the viability of his new organ.
"Liver not performing as it should," Barbara wrote the next day in her pocket calendar, hours before Harvey made landfall. "Storm was coming in."
The hurricane came and went that weekend, but Paul never recovered, even after receiving a second, emergency liver transplant later that week.
Barbara said she wasn't surprised when she learned from a reporter that Paul was one of 15 St. Luke's patients who died following liver transplants last year. She and her family said they had concerns about the care he received.
Barbara signed a release allowing St. Luke's to speak to reporters about her husband's case; the hospital did not answer questions about his care.
Hours before Paul received his second liver transplant, about a week after the first one failed, Barbara and her children recalled watching in horror as he started to have a seizure in his hospital bed.
After several minutes, a doctor was summoned; he noted the "seizure like activity" in Paul's medical records and gave him drugs to bring the tremors under control. Two hours later, Paul was taken for his second liver transplant.
A day later, on Sept. 1, 2017, Barbara noted her husband's progress in her calendar: "Seizures have continued. Have tried many different medications, but they continue."
Barbara continued taking notes throughout Paul's month-long hospital stay, documenting his steady decline.
She sat next to her husband for several days, squeezing his hand and singing love songs, hoping to see a flicker. It never came, however, and she and her family together made the decision to let him go.
On Sept. 23, Barbara jotted one last note.
"I was able to lay with him and love on him," she wrote. "Was holding him when he took his last breath."
John Chambers was nervous when he got the call from St. Luke's three days after Christmas last year. The 56-year-old former FedEx deliveryman from south Houston knew he would eventually need a transplant after years spent struggling with an inflammatory lung disease, but he'd been breathing easier in recent months, and now he was having second thoughts.
Chambers reluctantly went ahead with the double-lung transplant that day, his wife said, fearing he wouldn't get another chance. But more than a month later, he still couldn't sit up or breath on his own.
"He was in worse shape than when he went in," said his wife, Marilyn.
Finally, in late January 2018, doctors said they identified a major cause of his continued struggles: A tear had formed in John's respiratory tract where the transplant surgeon had connected the donor lungs to his air passageway.
Such airway complications occur in between 5 percent and 10 percent of lung transplant patients, experts say, but rarely are they as severe as the "Grade 4 dehiscence" that had opened in John's respiratory tract.
Despite doctors' efforts to repair the airway, St. Luke's officials would later acknowledge that the complication triggered other serious problems — infections, pneumonia, inflammation, organ failure — that ultimately led to John's death in April.
Marilyn believes there were other factors. She repeatedly complained to hospital staff about the care provided to her husband. The concerns are documented in a series of letters between her and hospital administrators.
In one instance, a nurse used a harness to lift her husband out of bed, Marilyn said, and in the process tore open his surgical wound, soaking his gown in blood. Other times, she said, staff inadvertently jostled lines connecting her husband to life-support equipment or failed to follow doctor's instructions.
"It was one thing after another," Marilyn said. "I couldn't believe the way they treated him at that hospital."
In the written statement, Gerry, the hospital spokeswoman, noted that St. Luke's has maintained "magnet" status in nursing care for two decades, signaling that the hospital meets quality standards laid out by the American Nurses Credentialing Center.
"We have full confidence in our nursing professionals in the care they provided to the patients you highlighted and are aware of the patient concerns you relayed," Gerry wrote, referring to the care provided to all of the patients included in this story. "We reviewed and responded to families' questions and comments, and immediately followed up as necessary."
In August, three months after John's death, Marilyn met with Nord, the hospital's president, along with Loor and others, to address her complaints. Chambers recorded the conversation and provided reporters with a copy of the audio.
During the meeting, Nord acknowledged that her hospital staff could have done a better job and said the hospital had educated staff based on some of her complaints.
Loor assured Marilyn that he and his team had done everything they could for John and that they were heartbroken with the outcome. Although it was another surgeon who performed John's lung transplant, Loor said he was confident that it was done correctly. He said that the tear in John's airway was likely the result of a common complication known as "graft dysfunction," in which a set of donor lungs goes into shock after being implanted in a patient.
Loor explained that he had hoped that John was going to recover from that setback, but the infections and other problems eventually became too much.
"Ms. Chambers, I'm really sorry about all of this," Loor said during the July meeting. "And I know it's got to be really hard for you, but I know that you're strong, and I know that he [John] is with us. I feel him with us. And we get better and I get better, we all get better from talking about these things and learning from these things. … We're going to take this to heart."
In early February, three days after doctors discovered the tear in Chambers' airway, Edmund Flores sat in a waiting room, praying for his wife while she underwent a double-lung transplant. Patsy Flores, a 58-year-old mother of two adult children, had spent more than a year struggling to catch her breath as result of high blood pressure in her lungs and a devastating autoimmune disease.
It became clear a day after her transplant that something was wrong.
When Loor and another surgeon reopened Patsy's chest two days after the transplant, they made a tragic discovery, her medical records show: One of the new lungs had inexplicably flipped over, pinching arteries and choking off blood flow to the organ. The complication, known as lung torsion, is so rare after lung transplants that only 12 cases had been publicly documented as of two years ago.
Researchers who examined each reported case concluded that the deadly complication can be mitigated in some instances if detected right away and corrected. But by the time St. Luke's doctors flipped Patsy's left lung back over, much of the organ had essentially died, according to her medical records.
In a statement, hospital spokeswoman Gerry wrote that initial X-rays following Patsy's surgery did not indicate any twisting of the lung. "Additionally," she wrote, "all of our standard intraoperative monitoring procedures confirmed correct alignment and orientation. … However, continued monitoring over the next 24 hours detected a misalignment in one of her lungs and a procedure was completed to address the alignment."
In an effort to save her, Loor removed the damaged lung and doctors put Patsy back on the transplant waiting list, in urgent need of a replacement. Within days, they accepted another lung for her and implanted it.
But it was not enough. Patsy spent nearly four months connected to life support, her medical records show. Her kidneys failed. She suffered repeated infections and bedsores.
Edmund also complained to hospital staff about his wife's care. A chaplain recorded some of the complaints in Patsy's medical records. Edmund said there were not enough nurses on staff overnight and on the weekends, leaving his wife to sometimes wait too long for assistance.
A few weeks after his wife's surgery, a nurse ripped open Patsy's surgical wound while attempting to lift her out of bed, Edmund said, the first of two times that happened: "From that point forward," he said, "it was taking that much longer to heal."
Patsy smiled in photos as her family gathered around her hospital bed to celebrate her 59th birthday in April. But physically, she continued to decline. She lost weight. Her organs shut down. Infections spread through her body. And finally, on June 1, she aspirated vomit into her lungs and died two days later.
A month later, Edmund sat looking through photos of his wife at their home in Channelview, a blue-collar town east of Houston.
"Woo boy, she was something else," Edmund said, fighting back tears. "She was a beautiful woman. Strong, vibrant, full of life."
Edmund said that he understands Patsy was critically ill, and that she wouldn't have survived much longer without a transplant. But he's struggling to come to terms with the rare complication that caused her first transplant to fail, and with what he felt were lapses in care from seemingly overworked nurses and other medical staff in the months that followed.
"The nurses were doing a fantastic job," he said. "But there was only so much they could do because they were stretched so thin."
Since Patsy's death, Edmund has received two anonymous letters in the mail. He suspects they were from someone who was involved in his wife's care, or another hospital employee.
The first note alleged that there were problems with Patsy's transplant and claimed that her death "should have been avoided!!!" The second mentioned other lung transplant deaths this year and encouraged him to contact a Chronicle reporter.
"I need you to know that the lung twist was avoidable," the letter read, "and the whole team feels so so bad for you and your family."
Flores doesn't know what to make of the notes.
For now, he has filed them away with other records documenting his wife's stay at St. Luke's.
After becoming the nation's busiest lung transplant program six years ago, the hospital scaled back the number and difficulty of transplants it performed. For some patients, that meant having to look elsewhere for treatment.
This article first appeared November 30, 2018 on ProPublica.
By Mike Hixenbaugh
Godfrey "G.W." Biscamp could barely breathe. After months of struggling with an inflammatory lung disease, his doctor told him he was in need of a transplant, and in 2013, he sent him to Houston Methodist.
There was no better transplant program in the country for patients in need of new lungs, one physician told him. But by the time Biscamp arrived, the program had begun to change.
Biscamp spent more than a year as a patient at Methodist, hoping for a lung transplant that never came. Instead, after numerous appointments and tests, he said doctors reversed themselves in early 2015, saying his condition was too perilous to risk a transplant.
Biscamp did not realize that, behind the scenes, Methodist had been struggling with a high rate of failed lung transplants, or that the hospital had significantly scaled back the number and difficulty of transplants it was willing to perform. Those issues have never before been reported publicly.
"I walked into Methodist at a time when the word on the street was, these guys are blowing and going," Biscamp said. "They are transplanting people left and right, and they are the best in the business. Then all of the sudden while I was there, apparently it blew apart, but nobody told me."
Biscamp, a 64-year-old former military test pilot, had the misfortune of needing a new set of lungs during a period of instability and change among Houston's transplant hospitals. His four-year struggle for new lungs demonstrates the human consequences that can follow when a transplant program falters. And it shows the challenges facing patients with advanced organ failure while trying to decide where best to seek treatment.
After leaving Methodist, Biscamp transferred to nearby Memorial Hermann, which was launching a new lung transplant program led by one of his former Methodist doctors. But after two years, Biscamp recalled doctors there telling him his case was too risky, again leaving him to seek care elsewhere.
With his inflammatory lung disease worsening, Biscamp was expecting to be disappointed when he arrived at Baylor St. Luke's Medical Center in early 2017, another Houston lung transplant program that has undergone significant changes in recent years.
But doctors at St. Luke's surprised him. Biscamp arrived at the hospital around the same time as its new lead lung transplant surgeon, and within a few months, he received a new set of lungs.
More than a year later, he knows he's fortunate to be alive.
"I got shuffled around big time," Biscamp said. "I got run through the bushes."
There was a reason Biscamp's doctors initially sent him to Methodist. A year earlier, in 2012, the hospital performed a staggering 143 lung transplants, making it the busiest program in America. The hospital's willingness to travel farther for donor lungs, to treat sicker patients and to attempt new and unconventional surgical techniques drew national media attention.
But as the program was growing, so was its rate of poor outcomes.
Between the beginning of 2012 and the middle of 2014, about a quarter the 289 patients who received new lungs at Methodist had their transplants fail in less than a year, a rate significantly higher than the national average and worse than expected based on its own patient and donor characteristics, according to data compiled and analyzed by the Scientific Registry of Transplant Recipients.
In an interview earlier this month, top Methodist officials acknowledged the below-average outcomes and said they proactively made changes to turn things around, ultimately avoiding the sort of federal crackdown that caused St. Luke's to lose Medicare funding for heart transplants this year. (St. Luke's says it has made numerous improvements, including hiring new surgeons, and it is appealing the decision.)
Turning things around at Methodist meant hiring additional medical staff for the lung program, improving administrative oversight and — unfortunately for some patients — performing fewer high-risk transplants.
"Even before these results came out, we had started our improvement efforts," said Roberta Schwartz, Methodist's executive vice president, emphasizing that the hospital's lung outcomes have steadily improved since then and are now in line with national standards.
Dr. Osama Gaber, a surgeon who oversees all of Methodist's transplant programs, said he commissioned an extensive review of the lung program in 2013 and determined that doctors had been taking on too many high-risk cases, including patients over the age of 70 and those seeking a second or third lung transplant.
Transplant outcomes are measured on a curve, taking into account dozens of patient and donor characteristics in an effort to ensure hospitals are not punished for treating sicker patients than their peers. That includes a patient's age and whether they received a transplant previously.
Nonetheless, the hospital reformed its patient selection standards and hired additional staff members beginning in 2013, Gaber said, and soon outcomes began to tick upward. By 2015, the year Biscamp was turned down for transplant, Methodist performed a total of 75 lung transplants, about half as many as in 2012, according to publicly reported data.
Gaber said patient privacy rules prevented him from commenting on the reasons Biscamp was turned down for transplant. But, Gaber said, cases like his should be seen as a testament to the range of treatment options offered to patients at the Texas Medical Center in Houston.
Gaber acknowledged that the hospital's improvement efforts meant fewer patients received new lungs. He said that is a tragic consequence of the federal government's requirement that transplant programs meet national benchmarks for one-year patient survival.
"Every program that's been flagged [by the government] shrinks," Gaber said.
Dr. Scott Scheinin, Methodist's lead lung transplant surgeon until late 2017, disagreed with the notion that patient selection was the main cause of below-average lung outcomes. He noted that, even when the program was treating sicker patients, the hospital was achieving above-average one-month survival rates, indicating to him that the problems weren't related to surgical outcomes, but with the care that followed.
Scheinin said he does not believe Methodist had adequate medical staffing to care for the hospital's huge population of lung recipients in the months following their transplants. All organ recipients are given anti-rejection medications that suppress their immune systems, making them vulnerable to illnesses and death following transplant.
"We had a slew of people who would die between eight and 14 months after transplant," said Scheinin, who has since gone to work for a transplant program in New York. "To me, that means somebody is not paying attention to them. Something is wrong."
When asked about Scheinin's comments, Gaber said the hospital's improvement efforts included hiring additional staff and strengthening post-transplant care.
Although lung outcomes have gotten better in recent years, Gaber said he and his team are continuing to look for ways to make improvements.
"This is not like a speedboat; this is like a airplane carrier," Gaber said. "You've got to move it very slowly."
